Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
FOSHAN HUAXIN PACKAGING CO., LTD.
INTERIM REPORT 2019
August 2019
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of Foshan Huaxin Packaging Co., Ltd. (hereinafter
referred to as the “Company”) hereby guarantee the factuality, accuracy and completeness of
the contents of this Report and its summary, and shall be jointly and severally liable for any
misrepresentations, misleading statements or material omissions therein.
Ren Xiaoping, the Company’s legal representative, Ding Guoqiang, the Company’s Chief
Financial Officer, and Shang Qiang, the Company’s Financial Manager hereby guarantee that
the Financial Statements carried in this Report are factual, accurate and complete.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
Any plans for the future and other forward-looking statements mentioned in this Report and
its summary shall NOT be considered as absolute promises of the Company to investors.
Therefore, investors are reminded to exercise caution when making investment decisions.
The Company has no interim dividend plan, either in the form of cash or stock.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Table of Contents
Interim Report 2019...........................................................................................................................1
Part I Important Notes, Table of Contents and Definitions........................................................... 2
Part II Corporate Information and Key Financial Information................................................... 5
Part III Business Summary............................................................................................................... 8
Part IV Operating Performance Discussion and Analysis............................................................12
Part V Significant Events.................................................................................................................19
Part VI Share Changes and Shareholder Information................................................................. 38
Part VII Preferred Shares................................................................................................................42
Part VIII Directors, Supervisors and Senior Management..........................................................43
Part IX Corporate Bonds.................................................................................................................44
Part X Financial Statements............................................................................................................45
Part XI Documents Available for Reference................................................................................ 184
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Definitions
Term Definition
China Chengtong China Chengtong Holdings Group Ltd. (the ultimate controller of the Company)
China Paper China Paper Corporation (the actual controller of the Company)
Foshan Huaxin Packaging Co., Ltd. and its consolidated subsidiaries, except
The “Company”, “FSHXP” or “we”
where the context otherwise requires
Huaxin Development Foshan Huaxin Development Co., Ltd.
Hongta Renheng Zhuhai Hongta Renheng Packaging Co., Ltd.
Zhuhai Huafeng Zhuhai Huafeng Paper Co., Ltd.
Golden Pheasant Chemical Zhuhai Golden Pheasant Chemical Co., Ltd.
Huaxin Color Printing Huaxin (Foshan) Color Printing Co., Ltd.
Chengtong Finance China Chengtong Finance Corporation Ltd.
Zhejiang Hongta Zhejiang Hongta Renheng Packaging Technology Co., Ltd.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name Huaxin Packaging-B Stock code 200986
Stock exchange for stock
Shenzhen Stock Exchange
listing
Company name in Chinese 佛山华新包装股份有限公司
Abbr. (if any) 华新包装
Company name in English (if
Foshan Huaxin Packaging Co.，Ltd
any)
Abbr. (if any) FSHXP
Legal representative Ren Xiaoping
II Contact Information
Board Secretary Securities Representative
Name Ding Guoqiang Shi Hui
2/F, Block 7, 3 Keyang Road, Luoge Park, 2/F, Block 7, 3 Keyang Road, Luoge Park,
Chancheng Economic Development Zone, Chancheng Economic Development Zone,
Address
Nanzhuang Town, Chancheng District, Nanzhuang Town, Chancheng District,
Foshan, Guangdong Province, P.R.China Foshan, Guangdong Province, P.R.China
Tel. 0756-8666975 0756-8666978
Fax 0756-8666922 0756-8666922
Email address dinggq@htrh-paper.com shih@htrh-paper.com
III Other Information
1. Contact Information of the Company
Indicate by tick mark whether any change occurred to the registered address, office address and their zip codes, website address and
email address of the Company in the Reporting Period.
□ Applicable √ Not applicable
No change occurred to the said information in the Reporting Period, which can be found in the 2018 Annual Report.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2. Media for Information Disclosure and Place where this Report is Kept
Indicate by tick mark whether any change occurred to the information disclosure media and the place for keeping the Company’s
periodic reports in the Reporting Period.
□ Applicable √ Not applicable
The newspapers designated by the Company for information disclosure, the website designated by the CSRC for disclosing the
Company’s periodic reports and the place for keeping such reports did not change in the Reporting Period. The said information can
be found in the 2018 Annual Report.
IV Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
□ Yes √ No
H1 2019 H1 2018 Change (%)
Operating revenue (RMB) 1,733,126,237.68 1,747,156,340.92 -0.80%
Net profit attributable to the listed
10,489,265.80 -15,299,762.79 168.56%
company’s shareholders (RMB)
Net profit attributable to the listed
company’s shareholders before exceptional 8,813,571.35 -19,203,743.87 145.90%
gains and losses (RMB)
Net cash generated from/used in operating
-349,160,799.79 68,792,986.11 -607.55%
activities (RMB)
Basic earnings per share (RMB/share) 0.0208 -0.0303 168.65%
Diluted earnings per share (RMB/share) 0.0208 -0.0303 168.65%
Weighted average return on equity (%) 0.53% -0.78% 1.31%
30 June 2019 31 December 2018 Change (%)
Total assets (RMB) 5,807,130,648.83 5,794,694,744.15 0.21%
Equity attributable to the listed company’s
1,968,735,620.54 1,970,946,820.29 -0.11%
shareholders (RMB)
V Accounting Data Differences under China’s Accounting Standards for Business Enterprises
(CAS) and International Financial Reporting Standards (IFRS) and Foreign Accounting
Standards
1. Net Profit and Equity Differences under CAS and IFRS
□ Applicable √ Not applicable
No such differences for the Reporting Period.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2. Net Profit and Equity Differences under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
No such differences for the Reporting Period.
XI Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Item Reporting Period Note
Gain or loss on disposal of non-current assets (inclusive of
-16,367.16
impairment allowance write-offs)
Government subsidies charged to current profit or loss (exclusive
of government subsidies given in the Company’s ordinary course
3,936,321.35
of business at fixed quotas or amounts as per the government’s
uniform standards)
Non-operating income and expense other than the above 136,798.06
Less: Income tax effects 32,772.64
Non-controlling interests effects (net of tax) 2,348,285.16
Total 1,675,694.45 --
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Exceptional Gain/Loss
Items:
□ Applicable √ Not applicable
No such cases for the Reporting Period.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part III Business Summary
I Principal Activity of the Company in the Reporting Period
Is the Company subject to any industry-specific disclosure requirements?
No.
The Company specializes in the R&D, production and sales of high-end coated ivory board, chemicals for paper making and color
printing products. The businesses are described as follows:
(I) High-end coated ivory board
High-end coated ivory board is the primary product of the Company. As a category of white paperboard, it is applied in various fields
such as cigarette packaging, food packaging, medicine packaging, cosmetic packaging and living supplies packaging, which
represent the core business of the Company.
The R&D, production and sales of the ivory board is mainly undertaken by Zhuhai HongtaRenheng Packaging Co., Ltd. and Zhuhai
Huafeng Paper Co., Ltd. HongtaRenheng is the core high-end packaging board platform under Huaxin Packaging which is based in
domestic and overseas high-end packaging markets of cigarette and food and provides "personalized" products and services for
customers with "differentiation" business strategy. The Company now has three coated ivory board production lines, and the annual
production capacity around 600,000 tons. The Company's products can be divided into the following categories:
1. Ivory board for cigarette packaging is used in the high-end cigarette packaging market. The coated ivory board for cigarette
packaging produced by HongtaRenheng takes up a dominant position in the domestic cigarette packaging field. It represents the
highest level of coated ivory board quality in China. It has won a Golden Award at China’s International Paper & Paper Product
Brands Exhibition, and the top award of the Chinese science and technology community—the first-class State Science and
Technology Advancement Award. The anti-counterfeit coated ivory board with color fiber and true-color fiber etc.—a technology
that is independently developed by the Company and has been granted the national invention patent of China—has been successfully
applied in the packaging of a series of cigarettes in the “Hongta Group” and “HongyunHonghe Group" brands to combat
counterfeiting from the packaging materials, reaching the significant anti-counterfeit results of “easily identifiable but difficult to
copy”. Currently, a new type of ivory board for cigarette packaging is at the stage of trial sale.
2. In terms of ivory board for liquid and food packaging, the Company is the first to break the foreign technological monopoly with
its ivory board for liquid packaging. The Company’s homegrown sterile paperboard for packaging of liquid milk, fruit juice, herbal
tea and other drinks has effectively substituted imported products. The ivory board series for food packaging such as anti-oil food
grade coated board and high-end paper cup have been recognized by well-known catering groups after they are put into the market.
3. The high-end commercial ivory board is applied in the segmented packaging market fields like the high-end medicine, cosmetics,
and daily necessities. The anti-counterfeit coated ivory paper with personalized identification code independently developed by
Hongta Renheng and for which it has been granted the invention patent has been successfully applied in the anti-counterfeit
packaging of the high-end products like high-end medicine and cosmetics, which does not only solve the difficulties posed by impact
from counterfeit and shoddy products for customers at the source, but also effectively reduces the customer’s anti-counterfeit costs
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
and fake product crackdown expanses and win high trust from the market.
(II) Chemicals for paper making
Chemicals for paper making represent an upstream extension of the Company’s business of the paper-making industrial chain. The
R&D, production and sales of which are mainly undertaken by Golden Pheasant Chemical, a subsidiary of the Company, which
mainly supplies the carboxylic butadiene-styrene latex, styrene-acrylic latex and calcium carbonate of domestically first-class quality.
(III) Color printing products
Color printing represents a downstream extension of the Company’s business of the paper-making industrial chain, which covers
designing and manufacturing packaging materials and providing packaging solutions for customers. This business is mainly
undertaken by Huaxin (Foshan) Color Printing Co., Ltd. Main products include color boxes, various labels (paper label, in-mold label
and sticker), barcode printing, brochure, books and periodicals in the field of end consumer products.
II Material Changes in Major Assets
1. Material Changes in Major Assets
No such changes in the Reporting Period.
Major assets Main reason for material changes
2. Major Assets Overseas
□ Applicable √ Not applicable
III Core Competitiveness Analysis
Is the Company subject to any industry-specific disclosure requirements?
No.
(I) Backed by a central government-owned enterprise
The ultimate controller of the Company, China Chengtong Holdings Group Ltd. (China Chengtong), is among the first batch of pilot
state-owned capital operation companies, and its main business includes equity operation, financial services, asset management,
integrated logistics services, production materials trading, forestry-pulp paper production development and utilization etc.. It is also
the only large-scale central enterprise approved by the State-owned Assets Supervision and Administration Commission of the State
Council to focus on production, development and utilization of forestry, wood pulp and paper. As the flagship state-owned enterprise
in the wood pulp paper industry, China Chengtong takes the initiative to conduct a restructuring based on its industrial chain
advantages to enhance its market and technological influence, as well as to facilitate diversified operations. China Chengtong is
aiming at improving the state-owned capital’s operation efficiency, serving the national strategy, abiding by the law of the market,
and building a state-owned capital operation platform featuring the market-oriented operation and professional management. In
addition, it will promote the rational flow and optimized of the state-owned capital and optimizing the configuration through equity
operation, value management, and flexible transfer etc., so as to form an institutional mechanism and operational model that meet
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
various functional requirements for corresponding state-owned capital operation.
As approved by the State Council and entrusted by the State-owned Assets Supervision and Administration Commission, China
Chengtong, as the main sponsor, cooperated with nine central enterprises, local state-owned enterprises and financial institutions to
jointly set up the largest domestic private equity investment fund with a total investment of RMB350 billion--The China
State-Owned Enterprise Restructuring Fund. Meanwhile, Chengtong Fund Management Co., Ltd. was also established to take
responsibility for the implementation of relevant fund management affairs.
(II) Technological innovation advantage
The Company persists in taking "scientific and technological innovation" as the core power that drives enterprise development. The
Company has over 20 years of technical experience in the production of high-end coated ivory board. Over the years, the Company
has developed anti-counterfeit products such as the coated ivory board with color fiber and true-color fiber and formed strong
anti-counterfeit product innovation capability. Meanwhile, the Company has personalized product technique innovation capability
and has developed the "anti-counterfeit coated ivory paper with personalized identification code" which can attain anti-counterfeiting
according to the customer's personalized demand and solve the difficulties posed by impact from counterfeit and shoddy products for
customers at the source. Currently, the Company is developing quite a few individualized products featuring new technologies. In
addition, to ensure safe, green and clean products, the Company has managed to effectively control toxic and harmful substances
such as VOCS in its products through continuous commitment of R&D resources and tests.
In recent years, the Company has made unremitting effort to promote its subsidiaries’ R&D system improvement:
In terms of paper making, Hongta Renheng has established a technology R&D center equipped with completed devices, and been
recognized by the Provincial Technology Centers, Engineering R&D Center and Guangdong Provincial Innovation Pilot Enterprise;
in 2016, the "Nature Color Packaging Paper Project" of Hongta Renheng won second-class Science and Technology Advancement
Award issued by China National Light Industry Council. Meanwhile, the company also participated in formulating corresponding
national and industrial standards including Coated Paper and Board-Coated Ivory Board and Quality Requirements and Test Methods
for Intaglio Printed Matter; in 2017, the project of “The R&D and Industrialization of True-Color Fiber Anti-Counterfeit Coated
Ivory Board” jointly conducted by Hongta Renheng and HongyunHonghe Group won second-class Science and Technology
Advancement Award issued by China National Light Industry Council; in December 2018, the “ivory board for PE-free green paper
cups” developed by Hongta Renheng was authenticated by experts, representing a domestically leading technological level; in March
2019, upon careful selection, Hongta Renheng was given the title of “An Advanced Enterprise for Standardized Paper Making” by
China Standardization Technical Committee of Papermaking Industry; and in August 2019, in order to maintain technological
advancement and base R&D on the industry and market, Hongta Renheng gathered its advantageous resources to establish the New
Material Development and Industrial Technology Research Institute to enhance its technological R&D foundation.
In addition, all the Company’s main subsidiaries have been recognized as "National High-tech Enterprise" and were granted the 10%
relief from income tax in three successive years.
In 2016, the subsidiary Zhuhai Huafeng Paper Co., Ltd. successfully passed the recognition for "National High-tech Enterprise" with
the certificate No. GR201644001293. Zhuhai Huafeng passed the recognition of Guangdong Zhuhai Huafeng Paper Engineering
Technology Research Center for Guangdong Provincial Department of Science and Technology.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
The subsidiary Zhuhai Golden Pheasant Chemical Co., Ltd. passed the review for "National High-tech Enterprise" in 2016 with the
certificate No. GR201644004219. It has also passed the verification by the Zhuhai Engineering Center.
The subsidiary Hongta Renheng passed the review for "National High-tech Enterprise" in 2018 with the certificate No.
GR201844005432.
The subsidiary Huaxin Color Printing passed the review for "National High-tech Enterprise" in 2018 with the certificate No.
GR201844009816.
By means of continuous research and development, the Company has obtained various patents, providing the most important
technical support and guarantee for the advancement of product competitiveness. As of the end of the Reporting Period, the
Company had been granted 54 duly authorized patents, including 25 invention patents and 29 utility models. There are 11 pending
patents.
(III) Quality and brand advantage
HongtaRenheng has the top award of the Chinese science and technology community—the first-class State Science and Technology
Advancement Award. The high-end coated ivory board produced by HongtaRenheng has excellent printing performance. Dominant
product—coated ivory board for tobacco packaging, setting the quality standard for China’s coated ivory board, takes up a dominant
position in high-end tobacco packaging field with a close to 1/3 market share. "Hongta" coated ivory board takes up a leading
position in domestic and overseas ivory board industry and leads the development of production and technology of domestic middle
and top grade coated ivory board. "Hongta" coated ivory board represents the highest level of production, technology and product of
coated ivory board in China, with a high reputation at home and abroad.
(IV) Management advantage
Over years of operational experience, the Company has developed a large group of excellent talents in technical innovation and
operation management innovation and built a stable decision-making team in operation management. During production and
operations, the Company has also created a characteristic corporate culture tailored to its development and gradually formed
management team advantages integrating corporate culture and core talents. It has established the “quality, environment,
occupational health and safety, energy and food safety management system, and passed FSC, PEFC/CFCC and EUTR certifications
as well as green food certification” management system. In the first half of 2019, while beefing up the introduction and development
of fresh college graduates, the Company vigorously promoted the introduction of high calibre talents from outside, and made a new
step in developing and driving marketing by virtue of the platform and talent resource advantages of the actual controller.
(V) Industrial chain advantage
The Company enjoys synergy of its industrial chain covering chemicals for paper making, paper making, color printing, etc. Golden
Pheasant Chemical and Huaxin Color Printing, subsidiaries of the Company, have achieved the growth of market efficiency step by
step through the platform resource support of existing industrial chain management, technologies, market and talents. They have
continued to adapt to market changes and enhance risk resistance and competitiveness by giving play to their management
advantages internally and expanding market resources externally.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part IV Operating Performance Discussion and Analysis
I Overview
In the first half of 2019, macro-economic indicators were in a downturn on the backdrop of complicated and changeable domestic
and foreign economic climates, coupled with such factors as the China-U.S. trade conflict and exchange rate fluctuations. Packaging
and paper industries, which are closely related with macro economy, encountered challenges in production and operations. The
slowdown in overall demand growth and the fluctuations in raw material prices led to a harsh operating environment in the
papermaking industry. According to the data of the National Bureau of Statistics, the total profits of above-scale paper making and
paper product industries were RMB28.15 billion in the first half of 2019, representing a YOY decrease of 25.4%, which was an
indicator of the operation difficulties facing those companies; in terms of chemical industry, the policies for safety and environmental
protection were turning stricter, total market increased slightly, prices fell back by a small margin, and the overall industry prosperity
was steady; in terms of the color printing industry, total market increased slightly and overall conditions were promising.
(I) Sticking to the leadership of the Communist Party of China (“CPC”) and integrating such guidance in the Company’s operations
As always, the Company sticks to the CPC leadership, pushes forward Party building in the new era, studies President Xi Jinping’s
socialist spirit with Chinese characteristics in a deep manner in the new era, strictly carries out the general Party building policy, and
promotes deep integration of CPC guidance and the Company’s operations. The Company aligns itself with the Party committee’s
goal of “setting the direction, making overall arrangements and ensuring implementation”, carries out education under the theme of
“staying true to the mission”, follows the overall requirements of “staying true to the mission, narrowing the gap and ensuring
implementation”, and takes measures of supervision and integrity education to enhance moral and disciplinary compliance. The
Company sticks to the CPC guidance, calls on its employees to enhance the relevant learning, takes on the big mission given by the
new era, beefs up its reform and strives for prosperity and development.
(II) Operations during the Reporting Period
In the first half of 2019, the Company proactively implemented the guidelines of governing bodies, fully carried out operations
driven by Party building, focused on high quality development, expanded market externally and cut costs internally to keep
improving operational efficiency and performances. The ivory board and related upstream and downstream sectors where the
Company is engaged featured cut-throat competition and imbalanced supply and demand. In the ivory board segment, the Company
faced many difficulties in production and operations but managed to maintain stability. In the chemical segment, the Company,
driven by sales, continued to take management measures including optimizing production and technologies as a positive response to
market changes. In the printing segment, the Company made breakthroughs by proactively attracting external high quality resources
and diversifying industrial chains, resulting in the growth of operating revenue and total profits.
For the first half of 2019, the Company recorded operating revenue of RMB1,733.1262 million and a net profit attributable to the
listed company’s shareholders of RMB10.4893 million; and as at 30 June 2019, the Company’s total assets stood at RMB5,807.1306
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
million and equity attributable to the listed company’s shareholders at RMB1,968.7356 million.
(III) Management Measures during the Reporting Period
1. Optimized the marketing structure and system and established a clear brand value
The Company adjusted the organizational structure of its marketing department, strengthened market functions, improved the
functions, structure and configuration of its marketing team, and supplement the support resources of reserve teams. It enhanced new
product development and focused on the development of key products. The Company reorganized its product standards and names,
integrated product classification, reinforced brand promotion through multiple channels, increased the brand value and built a
differentiated product structure.
2. Strictly controlled spending and enhanced management abilities
In the first half of 2019, the Company reduced its administrative expense by 25% compared with a year ago by means of enhancing
budget management, cost control, individual performance management and optimization of responsibilities for posts. Meanwhile, the
finance costs went down 34% year-on-year thanks to the refinement of the management methods for capital utilization, the
adjustments to the financing structure and the reduction of foreign exchange exposure risks.
(IV) Operation management concept for the second half of 2019
In the second half of 2019, in the paper segment, the Company will rebuild its operational system with “marketing and market” as the
core, “full use of load, high turnover and adjustment of structure” as the operating philosophy, higher operating efficiency as the goal,
and “products, customers and regions” as the focuses. It will stick to technology as a driving force and promote operational reforms.
In the printing segment, the Company will make active steps to seek project investment opportunities, broaden product fields and
sales channels and propel internal growth and external expansion. In the chemical segment, the Company will adopt the
“market-oriented strategy” externally and strengthen efforts to improve quality and increase efficiency internally.
II Analysis of Core Businesses
See “I Overview” above.
Year-on-year changes in key financial data:
Unit: RMB
H1 2019 H1 2018 Change (%) Main reason for change
Operating revenue 1,733,126,237.68 1,747,156,340.92 -0.80%
Cost of sales 1,539,779,030.57 1,595,138,938.68 -3.47%
Selling expense 69,402,517.15 69,997,755.68 -0.85%
Administrative expense 50,498,247.03 67,088,679.11 -24.73%
The adjustments to the
financing structure aimed
Finance costs 30,524,905.51 45,936,448.74 -33.55%
at reducing the financing
costs
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Income tax expense 3,245,990.34 2,962,396.75 9.57%
R&D expense 52,474,320.32 63,850,496.63 -17.82%
Net cash generated
A larger proportion of
from/used in operating -349,160,799.79 68,792,986.11 -607.55%
notes in sales revenue
activities
Net cash generated
Maturity of structured
from/used in investing 117,440,126.03 6,390,378.93 1,737.76%
deposits
activities
The adjustments to the
Net cash generated
financing structure with a
from/used in financing 303,563,076.57 -135,386,780.90 324.22%
rise in negotiation under
activities
letters of credit
Changes in net cash
Net increase in cash and generated from/used in
72,841,617.85 -59,877,113.04 221.65%
cash equivalents operating and financing
activities
Material changes to the profit structure or sources of the Company in the Reporting Period:
√ Applicable □ Not applicable
During the Reporting Period, the Company actively dealt with changes in the external environment and continued to enhance market
expansion. As a result, the papermaking segment saw a decline in loss and the color printing segment saw a solid growth in operating
results. Meanwhile, the internal management improvement efforts and the period cost control results made positive contributions to
the growth in the Company’s overall profit.
Breakdown of core businesses:
Unit: RMB
YoY change in YoY change in
Operating Gross profit YoY change in
Cost of sales operating revenue gross profit
revenue margin cost of sales (%)
(%) margin (%)
By operating division
Manufacturing 1,717,953,710.89 1,529,428,697.30 10.97% 4.34% 1.94% 2.09%
Other 15,172,526.79 10,350,333.27 31.78% -84.93% -89.09% 26.02%
By product category
Ivory board 1,430,522,018.99 1,311,874,817.49 8.29% 9.31% 7.03% 1.96%
Presswork 153,273,410.57 115,913,094.11 24.37% -1.94% -10.75% 7.47%
Chemicals 134,158,281.33 101,640,785.70 24.24% -26.08% -29.73% 3.94%
Other 15,172,526.79 10,350,333.27 31.78% -84.93% -89.09% 26.02%
By operating segment
Domestic 1,491,509,672.76 1,294,956,129.75 13.18% -0.20% -3.67% 3.13%
Overseas 241,616,564.92 244,822,900.82 -1.33% -4.38% -2.42% -2.04%
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
III Analysis of Non-Core Businesses
√ Applicable □ Not applicable
Unit: RMB
Amount As % of total profit Reason for formation Exceptional or recurrent
Income from long-term
equity investments
Investment income 16,774,990.13 1,474.50% Recurrent
(associates) measured at the
equity method
Losses on impairment for
Asset impairment -44,711.85 -3.93% Exceptional
other receivables
Non-operating Income from disposal of
1,010,381.90 88.81% Exceptional
income current assets
Non-operating Loss on disposal of current
873,583.84 76.79% Exceptional
expense assets
Asset disposal Disposal of non-current
-16,367.16 -1.44% Exceptional
income assets
Other income 3,936,321.35 346.00% Government subsidies Exceptional
IV Analysis of Assets and Liabilities
1. Material Changes in Asset Composition
Unit: RMB
30 June 2019 30 June 2018 Change in
As % of total As % of total percentag Reason for material change
Amount Amount
assets assets e (%)
217,327,217.7
Monetary capital 3.74% 354,612,863.22 6.39% -2.65%
5
Accounts 739,406,369.0
12.73% 743,129,178.17 13.40% -0.67%
receivable 7
784,520,862.4
Inventories 13.51% 741,788,752.26 13.38% 0.13%
9
Investment
30,425,974.11 0.52% 31,754,646.67 0.57% -0.05%
property
The investments to China Chengtong
Finance Corporation Ltd. were
Long-term equity 669,365,148.1
11.53% 8,205,989.25 0.15% 11.38% changed from available-for-sale
investments 3
financial assets to long-term equity
investments measured at equity method
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2,111,243,885. 2,232,204,184.
Fixed assets 36.36% 40.25% -3.89%
87 15
Construction in
44,969,165.79 0.77% 49,481,227.93 0.89% -0.12%
progress
Adjust financing structure, and the
Short-term 1,441,879,613.
24.83% 776,773,275.16 14.01% 10.82% documentary credit for the Reporting
borrowings 49
Period increased considerably
Long-term 100,000,000.0
1.72% 300,000,000.00 5.41% -3.69%
borrowings 0
2. Assets and Liabilities at Fair Value
□ Applicable √ Not applicable
3. Restricted Asset Rights as at the Period-End
The restricted assets of the Company totaled RMB210,501,700, of which, other current assets were RMB200 million which were
fixed time deposits guaranteed for pledge, the monetary capital was RMB10,501,700 as cash deposits.
V Investments Made
1. Total Investment Amount
□ Applicable √ Not applicable
2. Major Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
□ Applicable √ Not applicable
4. Financial Investments
(1) Securities Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
16
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
VI Sale of Major Assets and Equity Interests
1. Sale of Major Assets
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Interests
□ Applicable √ Not applicable
VII Main Controlled and Joint Stock Companies
√ Applicable □ Not applicable
Main subsidiaries and joint stock companies with an over 10% influence on the Company’s net profit
Unit: RMB
Relationship Principal Registered Operating Operating
Name with the activity Total assets Net assets Net profit
capital revenue profit
Company
White
Zhuhai
cardboard,
Hongta
original 600,000,000. 3,945,754,26 2,600,786,74 1,208,233,69 -19,442,56
Renheng Subsidiary -19,467,411.68
paper of 00 6.52 5.56 3.63 3.96
Packaging
liquid food
Co., Ltd.
packaging
White
Zhuhai cardboard,
Huafeng original 984,559,331. 2,654,794,40 984,390,313. 1,070,990,77 -16,945,12
Subsidiary -15,985,154.72
Paper Co., paper of 06 6.46 60 7.15 1.26
Ltd. liquid food
packaging
Zhuhai
Golden latex and
69,271,940.0 310,015,897. 164,664,691. 183,945,943. 13,256,790
Pheasant Subsidiary calcium 10,595,609.15
0 87 86 48 .17
Chemical carbonate
Co., Ltd.
Huaxin
Color
(Foshan)
packaging 96,895,605.1 386,556,677. 236,118,555. 158,049,754. 9,181,466.
Color Subsidiary 7,798,335.99
and label 4 83 15 53 07
Printing Co.,
printing
Ltd.
Subsidiaries obtained or disposed in the Reporting Period:
17
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
□ Applicable √ Not applicable
Information about major majority- and minority-owned subsidiaries:
Majority-owned subsidiaries-Hongta Renheng and Zhuhai Huafeng: during the Reporting Period, the losses from papermaking sector
of the company were decreased through actively coping with changes of external environment and continuously enhancing the
expansion of markets; the expense in the Reporting Period was controlled effectively through exploiting potentials for internal
management, which positively influenced the increase of overall profits of the company.
VIII Structured Bodies Controlled by the Company
□ Applicable √ Not applicable
IX Performance Forecast for January-September 2019
Warning of possible loss or considerable YoY change in the accumulative net profit made during the period-beginning to the end of
the next reporting period, as well as the reasons:
□ Applicable √ Not applicable
X Risks Facing the Company and Countermeasures
1. Market risk
High-end coated ivory board is the dominant product of the Company. However, affected by the concentrated release of the new
production capacity for various ivory boards in China in the past two years, the domestic demands didn’t increase greatly. The more
fierce market competition of the ivory boards in China has brought a great impact on the market of the Company’s products.
Countermeasure: intensify product structure adjustment, and strengthen the efforts in developing new products and expanding new
market.
2. Raw material price and exchange rate fluctuation risk
Main raw material used by the Company is paper pulp which is mainly imported from abroad. The fluctuation of international price
of paper pulp and fluctuation of US dollar greatly influence the costs, which means, the costs control of the Company is under great
pressure.
Countermeasure: keep a close watch on the paper pulp price change trend and RMB exchange rate tendency, gradually purchase
more paper pulp at home, and meanwhile, strategically purchase paper pulp as reserves when necessary, in order to effectively
control the cost.
3. Safety and Environmental Protection Risk
The Company is specialized in manufacturing with large mechanical equipment. Due to complicated production and manufacturing
environment, safety production and environmental requirements become much more stringent.
Countermeasures: strengthen the recognition and management of safety and environmental protection hazards; improve the
management of production & manufacturing machines and pollution discharge equipment/facilities; clearly define personnel
responsibilities of front-line production workers; enhance the supervision and inspection of safety operation on the production site;
reinforce corresponding publicity and education and create possible safety production atmosphere; consolidate job responsibilities for
staffs in environmental protection department; strictly implement environmental protection and emission standards; eliminate
possible risks of safety and environmental protection accidents.
18
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part V Significant Events
I Annual and Extraordinary General Meeting Convened during the Reporting Period
1. General Meeting Convened during the Reporting Period
Investor Index to disclosed
Meeting Type Convened date Disclosure date
participation ratio information
Announcement on
Resolutions of the
2018 Annual
General Meeting of
Foshan Huaxin
The 2018 Annual Annual General Packing Co., Ltd.
65.62% 9 April 2019 10 April 2019
General Meeting Meeting (Announcement No.:
2019-022) disclosed
on Securities Times,
Hong Kong Pao and
http://www.cninfo.co
m.cn.
2. Extraordinary General Meeting Convened at Request of Preference Shareholders with Resumed Voting
Rights
□ Applicable √ Not applicable
II Interim Dividend Plan for the Reporting Period
□ Applicable √ Not applicable
The Company has no interim dividend plan.
III Commitments of the Company’s Actual Controller, Shareholders, Connected Parties and
Acquirer, as well as the Company and Other Commitment Makers, Fulfilled in the Reporting
Period or still Ongoing at Period-End
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IV Engagement and Disengagement of CPAs Firm
Has the Interim financial report been audited?
19
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
□Yes √ No
This Interim Report is unaudited.
V Explanations Given by Board of Directors and Supervisory Committee Regarding
“Modified Auditor’s Report” Issued by CPAs Firm for the Reporting Period
□ Applicable √ Not applicable
VI Explanations Given by Board of Directors Regarding “Modified Auditor’s Report” Issued
for Last Year
□ Applicable √ Not applicable
VII Bankruptcy and Restructuring
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VIII Legal Matters
Significant lawsuits or arbitrations:
√ Applicable □ Not applicable
Situation of
Trial results and
Basic situation of Lawsuit Whether form Process of execution of
influences of Disclosure Disclosure
lawsuit amount into estimated lawsuit judgment of
lawsuit date index
(arbitration) (RMB ‘0,000) liabilities (arbitration) lawsuit
(arbitration)
(arbitration)
A major production The judgment has
safety accident was been made that
As of the
caused by a flash one fifth of
end of the
burn when Jiangsu responsibility of http://www.
Reporting
Tianxing RMB2.232 cninfo.com.
Period, the The case enters
High-Altitude million of cn/cninfo-n
final the execution
Anti-Corrosion compensation is ew/disclosu
judgment phase and
Engineering Co., respectively born re/szse_mai
for the civil Zhuhai Huafeng
Ltd. (hereinafter 1,116 None by Zhuhai 6 March 2017 n/bulletin_d
compensatio is claiming
referred to as Huafeng and other etail/true/12
n case has compensation
"Jiangsu four defendants. 03132688?a
been made, from other
Tianxing") and At present, Zhuhai nnounceTi
and the case defendants.
Wuhan Kedio Huafeng has me=2017-0
enters the
Electric Power received the 3-06
execution
Technology Co., compensation of
phase.
Ltd. (hereinafter RMB2.23 million
referred to as from defendants.
20
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
"Wuhan Kedio") RMB6.7 million is
carried out the still to be
maintenance of recovered.
120m chimney
anti-corrosion
project for Zhuhai
Huafeng, the
holding subsidiary
of the company, on
4 March 2017. Six
construction
workers of the
construction
company died in
the accident.
Zhuhai Huafeng
paid a total
compensation of
RMB 11.16 million
to relatives of the
victims on 7 March
2017 for Jiangsu
Tianxing and
Wuhan Kedio in
accordance with
the requirements
and under the
supervision of the
government.
Zhuhai Huafeng
applied to Zhuhai
Jinwan District
People's Court for
property
preservation before
litigation on 14
March 2017.
Zhuhai Huafeng
applied to Zhuhai
Jinwan District
People's Court for
recovery action in
which Jiangsu
Tianxing and
21
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Wuhan Kedio were
taken as joint
defendants on 16
March 2017. Then
Wuhan Kedio
applied to add
Yancheng Xinda
High-Altitude
Anti-Corrosion
Co., Ltd.
(hereinafter
referred to as
YanchengXinda) as
a defendant and
YanchengXinda
applied to add Liu
Jiechun as a
defendant. It is a
dispute case over
the right of
recourse of the
subsidiary of the
Company.
Other legal matters:
□ Applicable √ Not applicable
IX Punishments and Rectifications
□ Applicable √ Not applicable
No such cases in the Reporting Period.
X Credit Conditions of the Company as well as its Controlling Shareholder and Actual
Controller
□ Applicable √ Not applicable
XI Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures for
Employees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
22
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
XII Major Related-Party Transactions
1. Continuing Related-Party Transactions
√Applicable □ Not applicable
As % of Obtaina
total Approve ble Index
Relation
Total value of d Over the Method market to
ship Type of Specific Pricing
Related Transact value all transacti approve of price for Disclosu disclos
with the transacti transacti principl
party ion price (RMB’0 same-ty on line d line or settleme same-ty re date ed
Compan on on e
,000) pe (RMB’0 not nt pe inform
y
transacti ,000) transacti ation
ons ons
http://
www.c
ninfo.c
om.cn/
new/di
sclosur
e/detai
l?plate
=&org
Being Id=gss
decided z0200
China through 986&s
Actual Purchasi 18
Paper Continui negotiati Market 12,650.7 Remitta tockC
controll ng raw 10.37% 70,000 Not N/A March
Corpora ng on based price 4 nce ode=2
er material 2019
tion on the 00986
market &anno
value uncem
entId=
12059
03128
&anno
uncem
entTim
e=201
9-03-1
8
12,650.7
Total -- -- -- 70,000 -- -- -- -- --
4
Large-amount sales return in detail N/A
Give the actual situation in the N/A
23
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Reporting Period (if any) where an
estimate had been made for the total
value of continuing related-party
transactions by type to occur in the
Reporting Period
Reason for any significant difference
between the transaction price and the N/A
market reference price (if applicable)
2. Related-Party Transactions Regarding Purchase or Sales of Assets or Equity Interests
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Related Transactions Regarding Joint Investments in Third Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
4. Credits and Liabilities with Related Parties
√Applicable □ Not applicable
Indicate by tick mark whether there were any credits and liabilities with related parties for non-operating purposes.
□ Yes √ No
No such cases in the Reporting Period.
5. Other Major Related-Party Transactions
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XIII Occupation of the Company’s Capital by the Controlling Shareholder or Its Related
Parties for Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XIV Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable √ Not applicable
24
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major guarantees
√ Applicable □ Not applicable
(1) Guarantees
Unit: RMB'0,000
Guarantees provided by the Company for external parties (exclusive of those for subsidiaries)
Disclosure
Guarante
date of the Actual
Actual Having e for a
guarantee Line of occurrence date Type of Term of
Obligor guarantee expired or related
line guarantee (Agreement guarantee guarantee
amount not party or
announcem signing date)
not
ent
Guarantees provided by the Company for its subsidiaries
Disclosure
Guarante
date of the Actual
Actual Having e for a
guarantee Line of occurrence date Type of Term of
Obligor guarantee expired or related
line guarantee (Agreement guarantee guarantee
amount not party or
announcem signing date)
not
ent
Zhuhai Hongta
1 March
Renheng 29 April
20,000 1 March 2016 3,388 Joint-liability 2016 to 31 Nott Yes
Packaging Co., 2016
December
Ltd.
2019
Zhuhai Hongta
29 March
Renheng 24 January
10,000 29 March 2018 10,000 Joint-liability 2017 to 30 Not Yes
Packaging Co., 2017
March 2020
Ltd.
25
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Zhuhai Hongta
30 2 January
Renheng
December 7,000 2 January 2018 7,000 Joint-liability 2018 to 13 Not Yes
Packaging Co.,
2017 March 2020
Ltd.
Zhuhai Hongta
23 May 2017
Renheng 24 May
33,000 23 May 2017 27,100 Joint-liability to 22 May Not Yes
Packaging Co., 2017
2020
Ltd.
Zhuhai Hongta
31 May 2019
Renheng 23 August
10,000 29 May 2019 10,000 Joint-liability to 25 May Nott Yes
Packaging Co., 2018
2023
Ltd.
Zhuhai Hongta
29 May 2019
Renheng 23 August
10,000 21 May 2019 10,000 Joint-liability to 29 May Not Yes
Packaging Co., 2018
2023
Ltd.
Zhuhai Hongta
10 June 2019
Renheng 23 August
10,000 10 June 2019 10,000 Joint-liability to 10 June Not Yes
Packaging Co., 2018
2023
Ltd.
Zhuhai Hongta 26 October
Renheng 23 August 2018 to 31
10,000 26 October 2018 10,000 Joint-liability Not Yes
Packaging Co., 2018 December
Ltd. 2019
Zhuhai Hongta 28 November
1
Renheng 28 February 2019 to 27
December 20,000 20,000 Joint-liability Nott Yes
Packaging Co., 2019 November
2018
Ltd. 201
Zhuhai Hongta
10 October
Renheng 23 August
10,000 10 October 2018 8,000 Joint-liability 2018 to 31 Not Yes
Packaging Co., 2018
July 2020
Ltd.
Zhuhai Hongta 10 November
Renheng 24 May 10 November 2017 to 9
10,000 1,700 Joint-liability Not Yes
Packaging Co., 2017 2017 November
Ltd. 2019
Zhuhai Hongta
1 23 April 2019
Renheng
December 20,000 23 April 2019 20,000 Joint-liability to 23 October Not Yes
Packaging Co.,
2018 2020
Ltd.
Zhuhai Huafeng 23 August 8,000 10 October 2018 8,000 Joint-liability 10 October Nott Yes
26
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Paper Co., Ltd. 2018 2018 to 31
July 2020
29 October
Zhuhai Huafeng 25 October
35,000 29 October 2016 30,000 Joint-liability 2016 to 28 Not Yes
Paper Co., Ltd. 2016
October 2019
1 January
Huaxin (Foshan)
5 August 2016 to 31
Color Printing Co., 6,000 1 June 2016 6,000 Joint-liability Not Yes
2016 December
Ltd.
2020
Huaxin (Foshan) 22 October
30 October
Color Printing Co., 2,000 1 June 2018 2,000 Joint-liability 2018 to 21 Not Yes
2018
Ltd. October 2019
Total approved line for such Total actual amount of such
guarantees in the Reporting 300,000 guarantees in the Reporting 221,000
Period (B1) Period (B2)
Total approved line for such Total actual balance of such
guarantees at the end of the 300,000 guarantees at the end of the 183,188
Reporting Period (B3) Reporting Period (B4)
Guarantees provided between subsidiaries
Disclosure
Guarante
date of the Actual
Actual Having e for a
guarantee Line of occurrence date Type of Term of
Obligor guarantee expired or related
line guarantee (Agreement guarantee guarantee
amount not party or
announcem signing date)
not
ent
Zhuhai Golden 1 7 March
Pheasant Chemical December 10,000 7 March 2019 10,000 Joint-liability 2019 to 6 Not Yes
Co., Ltd. 2018 March 2022
29 November
Zhuhai Golden
23 August 29 November 2018 to 29
Pheasant Chemical 2,000 2,000 Joint-liability Not Yes
2018 2018 November
Co., Ltd.
2019
Total approved line for such Total actual amount of such
guarantees in the Reporting 40,000 guarantees in the Reporting 12,000
Period (C1) Period (C2)
Total approved line for such Total actual balance of such
guarantees at the end of the 40,000 guarantees at the end of the 12,000
Reporting Period (C3) Reporting Period (C4)
Total guarantee amount (total of the three kinds of guarantees above)
Total guarantee line approved in 340,000 Total actual guarantee amount 233,000
27
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
the Reporting Period in the Reporting Period
(A1+B1+C1) (A2+B2+C2)
Total approved guarantee line at Total actual guarantee balance
the end of the Reporting Period 340,000 at the end of the Reporting 195,188
(A3+B3+C3) Period (A4+B4+C4)
Total actual guarantee amount (A4+B4+C4) as % of the
99.14%
Company’s net assets
Of which:
Amount by which the total guarantee amount exceeds 50% of
20,245.69
the Company’s net assets (F)
Total of the three amounts above (D+E+F) 20,245.69
Compound guarantees:
(2) Irregularities in Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Other Major Contracts
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XV Corporate Social Responsibility (CSR)
1. Significant Environment Protection
Indicate by tick mark whether the Company or any of its subsidiaries is a heavily polluting business identified by the environmental
protection authorities of China
Yes
Discharge
Name of Number of Distribution Discharge Approved
Name of Way of standards Total Excessive
major discharge of discharge concentratio total
polluter discharge implemente discharge discharge
pollutants outlets outlets n discharge
d
Chemical Chemical Chemical Chemical
Discharged
oxygen oxygen oxygen oxygen
Chemical into water
demand, demand, demand, demand,
oxygen quality Sewage
Hongta and and and and
demand, purificatio 1 disposal Naught
Renheng ammonia ammonia ammonia ammonia
ammonia n plant center
nitrogen are nitrogen nitrogen are nitrogen are
nitrogen after being
37.34mg/l, are≤80mg/l, 55.32t and 294.4t and
disposed
0.555mg/l ≤8mg/l 0.7t 29.44t
28
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Sulfur
Sulfur
dioxide, Sulfur
dioxide, Sulfur
nitrogen dioxide,
Sulfur nitrogen dioxide,
Power oxide, nitrogen
dioxide, oxide, nitrogen
Hongta Organized boiler of smoke are oxide,
nitrogen 1 smoke oxide, Naught
Renheng discharge production 1.30mg/m3, smoke are
oxide, are≤50mg/ smoke are
line 71.43mg/m 34.04t,
smoke m3, 0.42t, 20.5t
3, 136.15t and
≤200mg/m3 and 2.99t
10.59mg/m 20.42t
, ≤30mg/m3
3
Chemical Chemical Chemical Chemical
Discharged
oxygen oxygen oxygen oxygen
Chemical into water
demand, demand, demand, demand,
oxygen quality Sewage
Zhuhai and and and and
demand, purificatio 1 disposal Naught
Huafeng ammonia ammonia ammonia ammonia
ammonia n plant center
nitrogen are nitrogen nitrogen are nitrogen are
nitrogen after being
31.61mg/l, are≤80mg/l, 31.59t and 180t and
disposed
0.83mg/l ≤8mg/l 0.67t 22.5t
Sulfur Sulfur Sulfur
Sulfur
dioxide, dioxide, dioxide,
Sulfur dioxide,
Power nitrogen nitrogen nitrogen
dioxide, nitrogen
Zhuhai Organized boiler of oxide, oxide, oxide,
nitrogen 1 oxide, Naught
Huafeng discharge production smoke are smoke are smoke are
oxide, smoke are
line 26.5mg/m3, 50mg/m3, 23.94t,
smoke 68t, 142t
74.5mg/m3, 100mg/m3, 66.16t and
and 26t
15.6mg/m3 20mg/m3 13.74t
Secondary
standard of
Phase II of
Emission
Limit for
20m Air
Non-methan Upper-air
Golden discharge Pollution
e emissions
Pheasant 1 outlet after 25mg/m (DB44/27-2 9.9662t 22.464t Naught
hydrocarbo after being
Chemical the disposal 001) and
n disposed
of RCO Emission
Limit for
Odor
Pollutants
(GB14554-
1993)
Golden Chemical Discharged Sewage Chemical Chemical Chemical Chemical
1 Naught
Pheasant oxygen to sewage disposal oxygen oxygen oxygen oxygen
29
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Chemical demand, discharge center demand, demand, demand, demand,
ammonia outlet and and and and
nitrogen ammonia ammonia ammonia ammonia
nitrogen are nitrogen nitrogen are nitrogen are
340mg/l, are≤350mg/ 1.7360t and 3.528t and
24.13mg/l l, ≤25mg/l 0.1216t 0.252t
First level
standard of
Phase II for
maximum
emission
Chemical Chemical Chemical
concentratio
oxygen oxygen oxygen
Chemical n of Class II
Discharged demand, demand, demand,
Huaxin oxygen Nanzhuang pollutant in
to sewage and and and
Color demand, 1 Jili Sewage Guangdong Naught
discharge ammonia ammonia ammonia
Printing ammonia Surge local
outlet nitrogen are nitrogen are nitrogen are
nitrogen standard-
6mg/l, 0.078t, and 0.178t and
Discharge
0.23mg/l 0.0105t 0.026t
Limit of
Water
Pollutants
(DB44/26-2
001)
II time
period of
lithographic
printing
(excluding
those taking
Total of metal,
Benzene, ceramic and
methylbenz glass as the
Benzene, Workshop
Huaxin ene, printing
methylbenz Organized of
Color 3 xylene : stock) in - - Naught
ene, xylene, discharge production
Printing 2.11mg/l； Guangdong
total VOCs line
total local
VOCs:27m standard-E
g/m mission
Standard for
Volatile
Organic
Compounds
in Printing
Industry
30
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(DB44/815-
2010）
Construction and operation of facilities for preventing pollution:
Hongta Renheng
The Sewage Station and Boiler were all built and operated by the third party. As for sewage, Hongta Renheng belongs to State key
monitoring enterprise; as for smoke, Hongta Renheng belongs to Zhuhai key monitoring enterprise.
1. The company established a Sewage Station whose maximum processing capacity was 12000m3/d, and it was put into service on 1
April 2013 with the investment of RMB14 million through applying A/O technology. The quality of water after such processing
could meet relevant national discharge standards stated in Discharge Standard of Water Pollutants for Pulp & Paper Industry
(GB3544-2008), and waste water (after processing) reaching corresponding standards would be discharged into Qianshan Water
Quality Purification Plant via the municipal sewage pipeline network of Xiangzhou District.
Meanwhile, corresponding COD, ammonia nitrogen, total phosphorus, and total nitrogen, and PH values auto monitoring system
would be installed at the discharge outlet, and the qualified unit, Zhuhai Fixed Star EP Technology Co., Ltd, would be in charge of its
operation management and 24-hour auto online detection and monitoring of COD, ammonia nitrogen, total phosphorus, and total
nitrogen, and PH values.
2. The company established 2 biomass briquette boilers with the operating capacity of 40 tons per hour were installed in association
with relevant dust removal measures. As ceramic multi-tube cyclone dust collector and bag-type dust removal technology were
applied to dispose flue gas, all discharged smoke pollutants, SO2 and nitric oxides via the 25m chimney would meet corresponding
discharge limit standard stated in Emission Standard of Air Pollutants for Boilers (DB44/765-2010). From 1 July 2019 onwards, the
emission of pollutants smoke, sulphur dioxide and nitrogen oxides must comply with the limit requirements of the Emission Standard
of Air Pollutants for Boilers (DB44/765/2019). To meet the requirements for the emission of nitrogen oxides, the Company
introduced a set of SNCR denitration equipment to carry out denitration.
Moreover, corresponding flue gas auto monitoring system would be installed at the discharge outlet, and the qualified unit would be
in charge of its operation management and 24-hour auto online detection and monitoring of discharged SO2, nitric oxides and smoke
dust.
Zhuhai Huafeng
1. The Company established a Sewage Station whose maximum processing capacity was 22000m3/d, and it was put into service on
28 September 2006 with the floor space 21,358m2 and the investment of RMB38 million through applying flocculation precipitation
+ SBR technology. In addition, SBR biochemical system applied Canada ADI company’ s SBR technology, and key devices were all
introduced from foreign countries. The quality of water after such processing could meet relevant national discharge standards stated
in Discharge Standard of Water Pollutants for Pulp & Paper Industry (GB3544-2008), and waste water (after processing) reaching
corresponding standards would be discharged into Nanshui Water Quality Purification Plant via the municipal sewage pipeline
network of Gaolan Port District.
Meanwhile, corresponding COD, ammonia nitrogen, total phosphorus, and total nitrogen, and PH values auto monitoring system
would be installed at the discharge outlet, and the qualified unit, Zhuhai Fixed Star EP Technology Co., Ltd, would be in charge of its
operation management and 24-hour auto online detection and monitoring of COD, ammonia nitrogen, total phosphorus, and total
nitrogen, and PH values.
2. The company established two self-supplied fire coal CFBs were installed with the operating capacity of 75t per hour in association
with relevant sulphur and dust removal measures. As out-of-furnace alkaline-mode wet desulphurization technology, bag-type dust
remover, low-temperature and low-nitrogen combustion technology + SNCR were applied to dispose flue gas, the
desulfurization rate is over 90%, the dust removal efficiency would exceed 99.6% and the denitration efficiency over 85%. All
discharged smoke pollutants, SO2 and nitric oxides via the 120m chimney (discharged in temporary chimney in the first half year of
2019) would meet special discharge limit standard stated in Emission Standard of Air Pollutants for Thermal Power Plants
31
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(GB13223-2011).
Moreover, corresponding flue gas auto monitoring system would be installed at the discharge outlet, and the qualified unit would be
in charge of its operation management and 24-hour auto online detection and monitoring of discharged SO2, nitric oxides and smoke
dust (the online monitoring system was not in operation due to the use of temporary chimney).
Golden Pheasant Chemical
Exhaust processing system and sewage station are in normal operation.
1. Establishing a Sewage Station whose maximum processing capacity was 70m3/d, and the actual processing capacity was about
90m3 per day through applying biosorption, fenton and MBR membrane technology. Sewage disposal facility is running normally,
and waste water (after processing) reaching corresponding standards would be discharged into Nanshui Sewage Disposal Plant in
Zhuhai City via the municipal sewage pipeline network of Gaolan Port District, Zhuhai City. When all industrial waste water after
disposal in sewage station can reach Class 1 Standard during the second period stated in Discharge Limits of Water Pollutants
(DB44/26-2001), it will be disposed after being discharged into Nanshui Sewage Disposal Plant in Zhuhai City via the municipal
sewage pipeline network of Gaolan Port District, Zhuhai City.
The Company built a new set of regenerative catalytic oxidizer (RCO) exhaust processors, and induced the original Phase I and
Phase II exhaust to that set of system for processing after the pre-treatment by the original filter. The capacity is 30,000 m3 per hour,
and the exhaust will be discharged in an organized manner once reaching the emission standards after being processed by the
processors. Secondary standard of Phase II of Emission Limit for Air Pollution (DB44/27-2001) and Emission Limit for Odor
Pollutants (GB14554-1993) were reached.
The unit of waste water devices is in normal operations while the unit of waste gas treatment devices is in the commissioning stage.
Huaxin Color Printing
1. The Company has appointed Foshan Green Leaf Environmental Protection Center to operate and maintain its waste water
processing pool, which has been in normal operations since the beginning. The pool adopts the “coagulative precipitation - contact
oxidation” process and has a maximum capacity of 48m3/d. When industrial waste water reaches the primary standard of the second
time interval in Guangdong’s local standard Discharge Limits of Water Pollutants (DB44/26-2001) after being processed by the
processing pool, the reclaimed water will be used to flush toilets (complying with the Water Quality Standard for Urban
Miscellaneous Water Consumption).
2. The Company’s organic waste gas is discharged when reaching the second time interval of lithography (excluding the lithography
with metals, ceramics and glass as printing substrates) in Guangdong’s local standard Emission Standard of Volatile Organic
Compounds for Printing Industry (DB44/815-2010) after being processed by three units of secondary low-temperature plasma
purifiers. The devices are in normal operations.
Appraisal of environment influences for construction project and other administrative licensing of environment protection
Hongta Renheng
1. In September 1998, passed the environmental impact assessment for the 150,000-ton high-grade packaging cardboard project by
the State Environmental Protection Administration and Guangdong Province Environmental Protection Bureau respectively (HF
[1998] No. 321 and YHH [1998] No. 208);
2. In 2010, passed the environmental impact assessment for the MBF technical renovation project (ZHJ [2010] No. 5) and the test
run of the renovation project (ZHS [2010] No. 6) by the Environmental Protection Bureau of Zhuhai Municipality;
3. In 2012, obtained the approval for the environmental impact report on the clean production of paper machines and the
comprehensive waste water treatment technology renovation project (ZXHJB [2012] No. 155) by the Environmental Protection
Bureau of Xiangzhou District;
4. In December 2003, passed the environmental acceptance for the completion of the 150,000-ton high-grade packaging cardboard
project (YHH [2003] No. 969);
32
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
5. In 2013, completed the acceptance of the MBF technical renovation project (ZHY [2013] No. 5);
6. In 2014, completed the acceptance of the biochemical treatment of waste water project (ZXHY [2014] No. 10)
7. In 2017, obtained the approval for the environmental impact report on the sludge resource utilization technical project (ZXHJB
[2017] No. 63)
Pollutant discharge permit, No. 91440400617502107U001P; validity period: from 7 June 2017 to 6 June 2020; issued by:
Environmental Protection Bureau of Xiangzhou District of Zhuhai City.
Zhuhai Huafeng
1. The reply letter of review opinions of the State Environmental Protection Administration on the environmental impact report for
the capital increase of Foshan Huafeng Paper Co., Ltd. for building a new project with the annual capacity of 300,000-ton high-grade
coating ivory board (HS [2005] No. 156)
2. The reply letter of opinions on the environmental protection acceptance for the completion of the autonomous MBF
environmental upgrading and technical renovation project of Zhuhai Huafeng Paper Co., Ltd. (ZHY [2015] No. 3)
3. The reply on the environmental assessment for the new annual 60,000-ton ivory board film processing construction project of
Zhuhai Huafeng Paper Co., Ltd. (ZGHJ [2012] No. 115)
4. The review opinions on the environmental impact report for the reuse of reclaimed water project of Zhuhai Huafeng Paper Co.,
Ltd. (ZGHJ [2013] No. 54)
5. The reply on the environmental assessment for the sludge burning project of Zhuhai Huafeng Paper (ZGHJ [2008] No. 69)
6. The review opinions of the Environmental Protection Bureau of Gaolangang District of Zhuhai Municipality on the environmental
assessment report for the expansion of the annual 180,000-ton ivory board production line project of Zhuhai Huafeng Paper Co., Ltd.
(ZGHJ [2014] No. 67)
7. The review opinions on the environmental impact registration for the garbage concentration center of Zhuhai Huafeng Paper Co.,
Ltd. (ZGHJ [2016] No. 58)
8. The approval on the environmental assessment for the waste water treatment renovation project of Zhuhai Huafeng Paper Co., Ltd.
(ZGHJ [2016] No. 106)
Pollution discharge permit, No. 914404006176214217001P; validity period: from 7 June 2017 to 6 June 2020; issued by:
Environmental Protection Bureau of ZHUHAI GAOLAN PORT ECONOMIC ZONE MANAGEMENT COMMITTEE.
Golden Pheasant Chemical
1. Acceptance inspection of Phase I environmental assessment: ZGHJY[2017] –No.007
2. Acceptance inspection of Phase II environmental assessment: ZGHJY[2016] –No.20
3. Pollution discharge permit, No. 4404062010000030 renewed on 28 December 2018, and it is valid until 31 July 2021; issued by:
Planning and Construction Environmental Protection Bureau of ZHUHAI GAOLAN PORT ECONOMIC ZONE.
Huaxin Color Printing
1. In August 2004, the project was approved by the Environmental Protection Bureau of Chancheng District of Foshan City through
the document Approval on the Report of the Environmental Impact of the Relocation and Expansion Project of Huaxin (Foshan)
Color Printing Co., Ltd. (No. B2004-0393). In October 2006, the relocation and expansion project of Huaxin (Foshan) Color Printing
Co., Ltd. passed the evaluation on environmental protection, as it was officially approved in the Application for Evaluation on
Environmental Protection of Construction Projects (CHY [2006] No. 149);
2. In May 2008, Chancheng Branch of the Planning Bureau of Foshan City approved the Company’s construction of waste water
pool through the document Opinions on the Planning Conditions of Construction Projects (FG (C) LGZ [2007] No. J223). In
September 2008, the construction project passed the evaluation on environmental protection, as it was officially approved in the
Application for Evaluation on Environmental Protection of Construction Projects (CHY [2008] No. 136);
3. In June 2012, the project was approved by the Environmental Protection Bureau of Chancheng District of Foshan City through the
33
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
document Approval on the Report of the Environmental Impact of the Phase III Production Workshop Expansion Project of Huaxin
(Foshan) Color Printing Co., Ltd. (No. CB2012-1-028). In December 2018, evaluation on the environmental protection of the Phase
III production workshop expansion project of Huaxin (Foshan) Color Printing Co., Ltd. was conducted in the form of independent
evaluation.
4. Renewing the pollution discharge permit, No. 4406042010231001; validity period: from 17 October 2018 to 16 October 2021;
issued by: Environmental Protection Bureau of Chancheng District of Foshan City.
Emergency plan for abrupt environment affairs
Hongta Renheng
Hongta Renheng prepared the Emergency Plan for Environmental Pollution and filed it with Zhuhai Environmental Protection
Bureau Environment Monitoring Branch on 17 December 2015; Filing No.: 44040120150P-L Emergency Plan for Abrupt
Environment Affairs of Zhuhai S.E.Z. Hongta Renheng Paper Co., Ltd. and the Risk Assessment Report for Abrupt Environment
Affairs of Zhuhai S.E.Z. Hongta Renheng Paper Co., Ltd. A new round of filing with Xiangzhou Branch of Zhuhai Environmental
Protection Bureau on 21 March 2019; Filing No.: 440402-2019-016-L Emergency Plan for Abrupt Environment Affairs of Zhuhai
Hongta Renheng Packaging Co., Ltd. and the Risk Assessment Report for Abrupt Environment Affairs of Zhuhai Hongta Renheng
Packaging Co., Ltd.
Zhuhai Huafeng
Zhuhai Huafeng prepared the Emergency Plan for Environmental Pollution and filed it with Environmental Protection Bureau of
ZHUHAI GAOLAN PORT ECONOMIC ZONE on 24 October 2013; and filed the Emergency Plan for Abrupt Environment Affairs
of Zhuhai Huafeng Paper Co., Ltd. (“Zhuhai Huafeng”) and the Risk Assessment Report for Abrupt Environment Affairs of Zhuhai
Huafeng Paper Co., Ltd. (“Zhuhai Huafeng”) with Environmental Emergency Management Office of Department of Environmental
Protection of Guangdong Province on 23 January 23 2015. Reassessment of emergency plan was completed on December 2018, and
it was filed on Environmental Protection Bureau of ZHUHAI GAOLAN PORT.
Golden Pheasant Chemical
Golden Pheasant Chemical prepared the Investigation Report for Environmental Emergency Resources, Time Risk Assessment
Report for Abrupt Environment, and Comprehensive Emergency Plan for Abrupt Environment Affairs and filed them with
Environmental Protection Bureau of ZHUHAI GAOLAN PORT ECONOMIC ZONE on October 2018.
Huaxin Color Printing
Huaxin Color Printing prepared the Emergency Plan for Abrupt Environment Affairs and the Risk Assessment Report for Abrupt
Environment Affairs. Filing No.: 440604-2017-034-L.
Environment self-monitoring scheme
Hongta Renheng
Hongta Renheng prepared self-monitoring scheme, annual self-monitoring report and self-monitoring result information and
disclosed the same on the Platform for Disclosure of Self-Monitoring Information of State-Controlled Enterprises at the Provincial
Level in Guangdong and the National Pollutant Sources Monitoring Data Management System Platform according to the
requirements of the Measures for the Self-Monitoring and Information Disclosure by the Enterprises subject to Intensive Monitoring
and Control of the State (for Trial Implementation) (HF[2013] No. 81) and the Work Scheme for the Self-Monitoring and Information
Disclosure by the Enterprises subject to Intensive Monitoring and Control of the State. The enterprise self-monitoring content
includes: air pollutant emission monitoring at main exhaust emission outlets, water pollutant emission monitoring at main wastewater
discharge outlets, and factory boundary noise monitoring, as follows:
1. Chemical oxygen demand and ammonia nitrogen shall be monitored every two hours every day and the values monitored shall be
disclosed; biochemical oxygen demand, total phosphorus and total nitrogen shall be monitored once a week and the values monitored
shall be disclosed; other pollutants in the wastewater shall be monitored once a month at least;
2. Sulfur dioxide, nitrogen oxides and particles shall be monitored every hour every day and the values monitored shall be disclosed;
34
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
other pollutants in the exhaust shall be monitored once a season at least;
3. Factory boundary noise shall be monitored once a season at least;
4. Factory boundary odor concentration shall be monitored once a season.
If the self-monitoring shall be carried out by an entrusted institution, a social testing institution that is certified by the competent
department of environmental protection at the provincial level or an environment monitoring institution to which the competent
department of environmental protection belongs shall be entrusted to carry out the monitoring task. The environment monitoring
institution to which the competent department of environmental protection belongs that has undertaken a supervisory monitoring task
shall not undertake the self-monitoring entrustment business of the enterprise monitored.
The enterprise has an online monitoring system of chemical oxygen demand, an online monitoring system of ammonia-nitrogen
containing wastewater and an online monitoring system of flue gas. The data of online monitoring systems of chemical oxygen
demand, ammonia-nitrogen, sulfur dioxide, nitrogen oxides and particles shall be disclosed on the Integrated Management Platform
of Key Pollution Sources in Guangdong Province every day; other pollutants shall be monitored by a qualified third party testing
institution that is entrusted according to relevant requirements and then monitoring data shall be disclosed on the Integrated
Management Platform of Key Pollution Sources in Guangdong Province and the Management System Platform of National Pollutant
Sources Monitoring Data.
Zhuhai Huafeng
Zhuhai Huafeng prepared self-monitoring scheme, annual self-monitoring report and self-monitoring result information and disclosed
the same on the Platform for Disclosure of Self-Monitoring Information of State-Controlled Enterprises at the Provincial Level in
Guangdong and the National Pollutant Sources Monitoring Data Management System Platform according to the requirements of the
Measures for the Self-Monitoring and Information Disclosure by the Enterprises subject to Intensive Monitoring and Control of the
State (for Trial Implementation) (HF[2013] No. 81) and the Work Scheme for the Self-Monitoring and Information Disclosure by the
Enterprises subject to Intensive Monitoring and Control of the State. The enterprise self-monitoring content includes: air pollutant
emission monitoring at main exhaust emission outlets, water pollutant emission monitoring at main wastewater discharge outlets, and
factory boundary noise monitoring, as follows:
1. Chemical oxygen demand and ammonia nitrogen shall be monitored every hour every day and the average values shall be
disclosed; other pollutants in the wastewater shall be monitored once a month at least;
2. Sulfur dioxide, nitrogen oxides and particles shall be monitored every hour every day and the average values shall be disclosed;
other pollutants in the exhaust shall be monitored once a season at least;
3. Factory boundary noise shall be monitored once a season at least;
4. Factory boundary odor concentration shall be monitored once a season.
5 The daily monitoring data of PH value, chroma and suspended solids in the wastewater and the weekly monitoring data of total
phosphorus and total nitrogen shall be disclosed on the Management System Platform of National Pollutant Sources Monitoring
Data.
If the self-monitoring shall be carried out by an entrusted institution, a social testing institution that is certified by the competent
department of environmental protection at the provincial level or an environment monitoring institution to which the competent
department of environmental protection belongs shall be entrusted to carry out the monitoring task. The environment monitoring
institution to which the competent department of environmental protection belongs that has undertaken a supervisory monitoring task
shall not undertake the self-monitoring entrustment business of the enterprise monitored.
The enterprise has an online monitoring system of chemical oxygen demand, an online monitoring system of ammonia-nitrogen
containing wastewater and an online monitoring system of flue gas. The data of online monitoring systems of chemical oxygen
demand, ammonia-nitrogen, sulfur dioxide, nitrogen oxides and particles shall be disclosed on the Integrated Management Platform
of Key Pollution Sources in Guangdong Province every day; other pollutants shall be monitored by a qualified third party institution
that is entrusted according to relevant requirements and then monitoring data shall be disclosed on the Integrated Management
35
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Platform of Key Pollution Sources in Guangdong Province and the Management System Platform of National Pollutant Sources
Monitoring Data.
Golden Pheasant Chemical
In accordance with the requirements of the Work Scheme for the Self-Monitoring and Information Disclosure by the Enterprises
subject to Intensive Monitoring and Control of the State, Golden Pheasant Chemical entrusts a qualified third party testing institution
to conduct wastewater and factory boundary noise test every year, as follows:
1. Biochemical oxygen demand, ammonia nitrogen, suspended solids and chemical oxygen demand test shall be conducted four times
a year at least;
2. Factory boundary noise test shall be conducted once a year at least.
3. LDAR test shall be conducted once a quarter.
Huaxin Color Printing
Huaxin Color Printing entrusts a qualified third party testing institution to conduct wastewater, exhaust and factory boundary noise
test every year, as follows:
(1) PH value, ammonia nitrogen, suspended solids, chemical oxygen demand, biochemical oxygen demand, chroma, sulfides, total
nitrogen and total phosphorus test shall be conducted twice a year at least;
(2) Benzene, toluene, xylene and total VOCs test shall be conducted twice a year at least;
(3) Factory boundary noise test shall be conducted twice a year at least.
Other environment-related information that should be disclosed:
None.
Other relevant information:
None.
2. Measures Taken for Targeted Poverty Alleviation
(1) Plans
The Company will carry out the targeted poverty alleviation according to the poverty alleviation plan and arrangements of the final
controller China Chengtong Holdings Group Ltd.
(2) Summary of the Related Work Done in the Reporting Period
The Company didn’t carry out any related work during the Reporting Period.
(3) Results
Measurement
Indicator Quantity/Progress
unit
1. General results —— ——
2. Itemized results —— ——
2.1 Out of poverty by industrial development —— ——
2.2 Out of poverty by transferring employment —— ——
36
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2.3 Out of poverty by relocation —— ——
2.4 Out of poverty by education —— ——
2.5 Out of poverty by improving health —— ——
2.6 Out of poverty by protecting ecological environment —— ——
2.7 Subsidy for the poorest —— ——
2.8 Social poverty alleviation —— ——
2.9 Other items —— ——
3. Accolades received (for what and at what level) —— ——
(4) Subsequent Plans
The Company will continuously carry out the targeted poverty-relief work with China Paper Corporation according to the
implementation plan of poverty alleviation project of the final controller China Chengtong Holdings Group Ltd, and continuously
carry out the subsequent targeted poverty alleviation plan.
XVI Other Significant Events
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XVII Significant Events of Subsidiaries
□ Applicable √ Not applicable
37
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part VI Share Changes and Shareholder Information
I. Share Changes
1. Share Changes
Unit: share
Before Increase/decrease in the Reporting Period (+/-) After
Shares as
Shares as
dividend
dividend
Percentag New converted Percentag
Shares converted Other Subtotal Shares
e (%) issues from e (%)
from
capital
profit
reserves
333,500,0 333,500,0
1. Private shares 65.98% 65.98%
00 00
333,500,0 333,500,0
1.1 Promoter’s shares 65.98% 65.98%
00 00
Such shares held by 332,930,2 332,930,2
65.87% 65.87%
domestic legal persons 90 90
Such shares held by
5,697,101 0.11% 5,697,101 0.11%
foreign legal persons
171,925,0 171,925,0
2. Public shares 34.02% 34.02%
00 00
2.2 Domestically listed 171,925,0 171,925,0
34.02% 34.02%
foreign shares 00 00
505,425,0 505,425,0
3. Total shares 100.00% 100.00%
00 00
Reasons for share changes:
□ Applicable √ Not applicable
Approval of share changes:
□ Applicable √ Not applicable
Transfer of share ownership:
□ Applicable √ Not applicable
Progress on any share repurchases:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
38
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Effects of share changes on the basic and diluted earnings per share, equity per share attributable to the Company’s ordinary
shareholders and other financial indicators of the prior year and the prior accounting period, respectively:
□ Applicable √ Not applicable
Other information that the Company considers necessary or is required by the securities regulator to be disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
□ Applicable √ Not applicable
II. Issuance and Listing of Securities
□ Applicable √ Not applicable
III. Total Number of Shareholders and Their Shareholdings
Unit: share
Total number of preference
Total number of ordinary shareholders with resumed
13,045 0
shareholders at the period-end voting rights at the period-end
(if any) (see note 8)
5% or greater ordinary shareholders or the top 10 ordinary shareholders
Total Increase Pledged or frozen shares
shares /decreas Private Public
Name of Nature of Shareholding held at e during ordinary ordinary
shareholder shareholder percentage (%) the the shares shares Status Number
period-e Reportin held held
nd g Period
FOSHAN
HUAXIN State-owned legal 329,512, 329,512,
65.20% 0 0
DEVELOPME person 030 030
NT CO., LTD.
GUOTAI
JUNAN
Foreign legal 3,228,41 3,228,41
SECURITIES( 0.64% 35,957
person 0 0
HONGKONG)
LIMITED
WU Foreign natural 2,561,99 2,561,99
0.51% 0
HAOYUAN person 1 1
Domestic natural 1,922,92 1,922,92
CAI YUJIU 0.38% 352,920
person 0 0
MIU JUN Domestic natural 0.31% 1,552,20 29,400 1,552,20
39
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
person 0 0
NORGES Foreign legal 1,352,72 1,352,72
0.27% 0
BANK person 0 0
ESSENCE
INTERNATIO
NAL
Foreign legal 1,205,25 1,205,25
SECURITIES 0.24% 0
person 2 2
(HONG
KONG) CO.,
LTD.
FOSHAN
CHAN BEN
State-owned legal 1,139,42 1,139,42
DE ASSET 0.23% 0 0
person 0 0
MANAGEME
NT CO., LTD
PENG Domestic natural 1,100,00 1,100,00
0.22% 46,761
RUIHUA person 0 0
Domestic natural 1,043,80 1,043,80
CAO YIFAN 0.21% 251,900
person 0 0
Strategic investor or general legal
person becoming a top-10 ordinary
N/A
shareholder due to rights issue (if
any) (see note 3)
Related or acting-in-concert parties It is unknown whether there is among the above shareholders any related or acting-in-concert
among the shareholders above party as defined in the Administrative Measures for the Acquisition of Listed Companies.
Top 10 public shareholders
Shares by type
Name of shareholder Public shares held at the period-end
Type Shares
GUOTAI JUNAN Domestically
SECURITIES(HONGKONG) 3,228,410 listed foreign 3,228,410
LIMITED stock
Domestically
WU HAOYUAN 2,561,991 listed foreign 2,561,991
stock
Domestically
CAI YUJIU 1,922,920 listed foreign 1,922,920
stock
Domestically
MIU JUN 1,552,200 listed foreign 1,552,200
stock
40
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Domestically
NORGES BANK 1,352,720 listed foreign 1,352,720
stock
ESSENCE INTERNATIONAL Domestically
SECURITIES (HONG KONG) 1,205,252 listed foreign 1,205,252
CO., LTD. stock
Domestically
PENG RUIHUA 1,100,000 listed foreign 1,100,000
stock
Domestically
CAO YIFAN 1,043,800 listed foreign 1,043,800
stock
Domestically
ZHANG LI 1,011,300 listed foreign 1,011,300
stock
Domestically
MA ZEQI 959,762 listed foreign 959,762
stock
Related or acting-in-concert parties
among top 10 unrestricted public
It is unknown whether there is among the above shareholders any related or acting-in-concert
shareholders, as well as between top
party as defined in the Administrative Measures for the Acquisition of Listed Companies.
10 unrestricted public shareholders
and top 10 shareholders
Top 10 ordinary shareholders
involved in securities margin None
trading (if any) (see note 4)
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted ordinary shareholders of the
Company conducted any promissory repo during the Reporting Period.
□ Yea √ No
No such cases in the Reporting Period.
IV. Change of the Controlling Shareholder or the Actual Controller
Change of the controlling shareholder in the Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Change of the actual controller in the Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
41
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part VII Preferred Shares
□ Applicable √ Not applicable
No preferred shares in the Reporting Period.
42
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part VIII Directors, Supervisors, Senior Management and Staff
I Change in Shareholdings of Directors, Supervisors and Senior Management
□ Applicable √ Not applicable
There were no changes in shareholdings of directors, supervisors, and senior management in the Reporting Period. For details, see
Annual Report of 2018.
II Changes in Directors, Supervisors and Senior Management
√Applicable □ Not applicable
Name Office title Type of change Date of change Reason for change
Yang Weixing Director Left 30 January 2019 Resignation
Zhang Chunhua Vice GM Engaged 31 January 2019 Engagement by the Board of Directors
Zhou Gaosong Director Elected 9 April 2019 General meeting election
Li Fei Vice GM Engaged 21 June 2019 Engagement by the Board of Directors
43
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part IX Corporate Bonds
Are there any corporate bonds publicly offered and listed on the stock exchange, which were undue before the approval date of this
Report or were due but could not be redeemed in full?
No
44
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part X Financial Statements
I. Auditor’s Report
Whether the interim report has been audited?
□Yes √ No
The interim report of the Company has not been audited.
II. Financial Statements
The unit of the financial statements attached: RMB
1. Consolidated Balance Sheet
Prepared by Foshan Huaxin Packaging Co., Ltd.
Unit: RMB
Item 30 June 2019 31 December 2018
Current assets:
Monetary capital 217,327,217.75 133,983,939.73
Settlement reserve
Interbank loans granted
Trading financial assets
Financial assets at fair value through
profit or loss
Derivative financial assets
Notes receivable 586,714,056.52 277,623,928.13
Accounts receivable 739,406,369.07 781,215,643.89
Financing backed by accounts
receivable
Prepayments 105,071,856.15 114,855,049.09
Premiums receivable
Reinsurance receivables
Receivable reinsurance contract
reserve
Other receivables 113,470,987.09 26,332,955.74
Including: Interest receivable 14,640,756.93 7,800,232.76
45
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Dividends receivable
Financial assets purchased under
resale agreements
Inventories 784,520,862.49 1,022,167,373.51
Contract assets
Assets classified as held for sale
Current portion of non-current assets
Other current assets 223,541,987.50 338,311,849.45
Total current assets 2,770,053,336.57 2,694,490,739.54
Non-current assets:
Loans and advances to customers
Investments in debt obligations
Available-for-sale financial assets 288,700.00 288,700.00
Investments in other debt obligations
Held-to-maturity investments
Long-term receivables
Long-term equity investments 669,365,148.13 662,590,158.00
Investments in other equity
instruments
Other non-current financial assets
Investment property 30,425,974.11 30,763,683.73
Fixed assets 2,111,243,885.87 2,178,817,683.33
Construction in progress 44,969,165.79 38,735,958.38
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 125,564,340.46 131,907,260.76
R&D expense 7,752,439.97 7,752,439.97
Goodwill 11,547,305.29 11,547,305.29
Long-term prepaid expense 3,879,682.06 4,755,506.18
Deferred income tax assets 31,549,345.48 31,549,345.48
Other non-current assets 491,325.10 1,495,963.49
Total non-current assets 3,037,077,312.26 3,100,204,004.61
Total assets 5,807,130,648.83 5,794,694,744.15
Current liabilities:
46
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Short-term borrowings 1,441,879,613.49 862,776,823.86
Borrowings from central bank
Interbank loans obtained
Trading financial liabilities
Financial liabilities at fair value
through profit or loss
Derivative financial liabilities
Notes payable 220,314,954.09 310,600,000.00
Accounts payable 348,604,162.77 464,643,787.56
Advances from customers 13,579,143.51 33,431,588.79
Financial assets sold under repurchase
agreements
Customer deposits and interbank
deposits
Payables for acting trading of
securities
Payables for underwriting of
securities
Payroll payable 25,621,766.25 44,817,842.45
Taxes payable 14,422,397.31 41,288,520.29
Other payables 102,679,622.82 179,737,877.39
Including: Interest payable 3,345,720.25 6,315,962.71
Dividends payable 25,904,459.19 25,083,228.68
Handling charges and commissions
payable
Reinsurance payables
Contract liabilities
Liabilities directly associated with
assets classified as held for sale
Current portion of non-current
200,000,000.00
liabilities
Other current liabilities
Total current liabilities 2,167,101,660.24 2,137,296,440.34
Non-current liabilities:
Insurance contract reserve
Long-term borrowings 100,000,000.00 100,000,000.00
47
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Bonds payable
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables
Long-term payroll payable
Provisions 1,508,735.64 1,508,735.64
Deferred income 27,744,778.62 30,305,313.30
Deferred income tax liabilities 2,131,935.03 2,131,935.03
Other non-current liabilities
Total non-current liabilities 131,385,449.29 133,945,983.97
Total liabilities 2,298,487,109.53 2,271,242,424.31
Owners’ equity:
Share capital 505,425,000.00 505,425,000.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 256,822,373.42 256,822,373.42
Less: Treasury stock
Other comprehensive income 169,714.39 169,714.39
Specific reserve
Surplus reserves 196,399,250.80 196,399,250.80
General reserve
Retained earnings 1,009,919,281.93 1,012,130,481.68
Total equity attributable to owners of
1,968,735,620.54 1,970,946,820.29
the Company as the parent
Non-controlling interests 1,539,907,918.76 1,552,505,499.55
Total owners’ equity 3,508,643,539.30 3,523,452,319.84
Total liabilities and owners’ equity 5,807,130,648.83 5,794,694,744.15
Legal representative: Ren Xiaoping Chief Financial Officer: Ding Guoqiang Financial Manager: Shang Qiang
2. Balance Sheet of the Company as the Parent
Unit: RMB
Item 30 June 2019 31 December 2018
48
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Current assets:
Monetary capital 15,757,416.24 357,681.85
Trading financial assets
Financial assets at fair value through
profit or loss
Derivative financial assets
Notes receivable
Accounts receivable
Financings backed by accounts
receivable
Prepayments
Other receivables 15,809,792.55 61,127,498.79
Including: Interest receivable 4,481,906.67
Dividends receivable
Inventories
Contract assets
Assets classified as held for sale
Current portion of non-current assets
Other current assets 97,759.37 45,344.03
Total current assets 31,664,968.16 61,530,524.67
Non-current assets:
Investments in debt obligations
Available-for-sale financial assets 288,700.00 288,700.00
Investments in other debt obligations
Held-to-maturity investments
Long-term receivables
Long-term equity investments 1,725,842,212.29 1,719,127,360.28
Investments in other equity
instruments
Other non-current financial assets
Investment property
Fixed assets 78,790.04 89,328.44
Construction in progress
Productive living assets
Oil and gas assets
49
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Right-of-use assets
Intangible assets 84,399.24 95,808.24
R&D expense
Goodwill
Long-term prepaid expense 145,956.53 168,411.39
Deferred income tax assets
Other non-current assets
Total non-current assets 1,726,440,058.10 1,719,769,608.35
Total assets 1,758,105,026.26 1,781,300,133.02
Current liabilities:
Short-term borrowings
Trading financial liabilities
Financial liabilities at fair value
through profit or loss
Derivative financial liabilities
Notes payable
Accounts payable
Advances from customers
Contract liabilities
Payroll payable 16,637.80 10,500.40
Taxes payable 25,120.74 1,214.50
Other payables 12,940,573.13 51,738,991.68
Including: Interest payable 2,536,586.20
Dividends payable 229,593.13 229,593.13
Liabilities directly associated with
assets classified as held for sale
Current portion of non-current
liabilities
Other current liabilities
Total current liabilities 12,982,331.67 51,750,706.58
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred shares
Perpetual bonds
50
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Lease liabilities
Long-term payables
Long-term payroll payable
Provisions
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities 12,982,331.67 51,750,706.58
Owners’ equity:
Share capital 505,425,000.00 505,425,000.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 250,531,482.00 250,531,482.00
Less: Treasury stock
Other comprehensive income
Specific reserve
Surplus reserves 196,399,250.80 196,399,250.80
Retained earnings 792,766,961.79 777,193,693.64
Total owners’ equity 1,745,122,694.59 1,729,549,426.44
Total liabilities and owners’ equity 1,758,105,026.26 1,781,300,133.02
3. Consolidated Income Statement
Unit: RMB
Item H1 2019 H1 2018
1. Revenue 1,733,126,237.68 1,747,156,340.92
Including: Operating revenue 1,733,126,237.68 1,747,156,340.92
Interest income
Premium income
Handling charge and
commission income
2. Costs and expenses 1,752,775,592.86 1,788,276,450.92
Including: Cost of sales 1,539,779,030.57 1,595,138,938.68
51
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Interest expense
Handling charge and
commission expense
Surrenders
Net claims paid
Net amount provided as
insurance contract reserve
Expenditure on policy
dividends
Reinsurance premium
expense
Taxes and surcharges 10,096,572.28 10,114,628.71
Selling expense 69,402,517.15 69,997,755.68
Administrative expense 50,498,247.03 67,088,679.11
R&D expense 52,474,320.32
Finance costs 30,524,905.51 45,936,448.74
Including: Interest
36,967,366.21 46,791,975.58
expense
Interest
8,948,675.02 2,283,360.76
income
Add: Other income 3,936,321.35 9,069,363.42
Return on investment (“-” for loss) 16,774,990.13 -88,375.92
Including: Share of profit or loss
16,774,990.13 -88,375.92
of joint ventures and associates
Income from the
derecognition of financial assets at
amortized cost (“-” for loss)
Foreign exchange gain (“-” for
loss)
Net gain on exposure hedges (“-”
for loss)
Gain on changes in fair value (“-”
1,340,892.01
for loss)
Credit impairment loss (“-” for
loss)
Asset impairment loss (“-” for loss) -44,711.85 59,432.48
Asset disposal income (“-” for -16,367.16 68,414.74
52
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
loss)
3. Operating profit (“-” for loss) 1,000,877.29 -30,670,383.27
Add: Non-operating income 1,010,381.90 1,600,770.29
Less: Non-operating expense 873,583.84 930,302.34
4. Profit before tax (“-” for loss) 1,137,675.35 -29,999,915.32
Less: Income tax expense 3,245,990.34 2,962,396.75
5. Net profit (“-” for net loss) -2,108,314.99 -32,962,312.07
5.1 By operating continuity
5.1.1 Net profit from continuing
-2,108,314.99 -32,962,312.07
operations (“-” for net loss)
5.1.2 Net profit from discontinued
operations (“-” for net loss)
5.2 By ownership
5.2.1 Net profit attributable to
10,489,265.80 -15,299,762.79
owners of the Company as the parent
5.2.1 Net profit attributable to
-12,597,580.79 -17,662,549.28
non-controlling interests
6. Other comprehensive income, net of
tax
Attributable to owners of the Company
as the parent
6.1 Items that will not be
reclassified to profit or loss
6.1.1 Changes caused by
remeasurements on defined benefit
pension schemes
6.1.2 Other comprehensive
income that will not be reclassified to
profit or loss under the equity method
6.1.3 Changes in the fair value of
investments in other equity instruments
6.1.4 Changes in the fair value of
the company’s credit risks
6.1.5 Other
6.2 Items that will be reclassified to
profit or loss
6.2.1 Other comprehensive
income that will be reclassified to profit
53
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
or loss under the equity method
6.2.2 Changes in the fair value of
investments in other debt obligations
6.2.3 Gain/Loss on changes in the
fair value of available-for-sale financial
assets
6.2.4 Other comprehensive
income arising from the reclassification
of financial assets
6.2.5 Gain/Loss arising from the
reclassification of held-to-maturity
investments to available-for-sale financial
assets
6.2.6 Allowance for credit
impairments in investments in other debt
obligations
6.2.7 Reserve for cash flow
hedges
6.2.8 Differences arising from the
translation of foreign
currency-denominated financial
statements
6.2.9 Other
Attributable to non-controlling
interests
7. Total comprehensive income -2,108,314.99 -32,962,312.07
Attributable to owners of the Company
10,489,265.80 -15,299,762.79
as the parent
Attributable to non-controlling
-12,597,580.79 -17,662,549.28
interests
8. Earnings per share
8.1 Basic earnings per share 0.0208 -0.0303
8.2 Diluted earnings per share 0.0208 -0.0303
Where business combinations under common control occurred in the current period, the net profit achieved by the acquirees before
the combinations was RMB0.00, with the amount for last year being RMB0.00.
Legal representative: Ren Xiaoping Chief Financial Officer: Ding Guoqiang Financial Manager: Shang Qiang
4. Income Statement of the Company as the Parent
Unit: RMB
54
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item H1 2019 H1 2018
1. Operating revenue 0.00 0.00
Less: Cost of sales 0.00 0.00
Taxes and surcharges 300.00
Selling expense
Administrative expense 1,666,382.33 1,297,844.72
R&D expense
Finance costs -449,112.53 265,114.18
Including: Interest expense 361,440.69 5,893,734.86
Interest income 815,925.83 5,681,129.91
Add: Other income 50,000.00
Return on investment (“-” for
16,714,852.01 3,214,180.81
loss)
Including: Share of profit or
16,714,852.01
loss of joint ventures and associates
Income from the
derecognition of financial assets at
amortized cost (“-” for loss)
Net gain on exposure hedges (“-”
for loss)
Gain on changes in fair value (“-”
for loss)
Credit impairment loss (“-” for
loss)
Asset impairment loss (“-” for
7,369.57
loss)
Asset disposal income (“-” for
loss)
2. Operating profit (“-” for loss) 15,554,951.78 1,650,921.91
Add: Non-operating income
Less: Non-operating expense
3. Profit before tax (“-” for loss) 15,554,951.78 1,650,921.91
Less: Income tax expense
4. Net profit (“-” for net loss) 15,554,951.78 1,650,921.91
4.1 Net profit from continuing
15,554,951.78 1,650,921.91
operations (“-” for net loss)
55
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
4.2 Net profit from discontinued
operations (“-” for net loss)
5. Other comprehensive income, net of
tax
5.1 Items that will not be reclassified
to profit or loss
5.1.1 Changes caused by
remeasurements on defined benefit
pension schemes
5.1.2 Other comprehensive income
that will not be reclassified to profit or
loss under the equity method
5.1.3 Changes in the fair value of
investments in other equity instruments
5.1.4 Changes in the fair value of
the company’s credit risks
5.1.5 Other
5.2 Items that will be reclassified to
profit or loss
5.2.1 Other comprehensive income
that will be reclassified to profit or loss
under the equity method
5.2.2 Changes in the fair value of
investments in other debt obligations
5.2.3 Gain/Loss on changes in the
fair value of available-for-sale financial
assets
5.2.4 Other comprehensive income
arising from the reclassification of
financial assets
5.2.5 Gain/Loss arising from the
reclassification of held-to-maturity
investments to available-for-sale
financial assets
5.2.6 Allowance for credit
impairments in investments in other
debt obligations
5.2.7 Reserve for cash flow hedges
5.2.8 Differences arising from the
56
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
translation of foreign
currency-denominated financial
statements
5.2.9 Other
6. Total comprehensive income 15,554,951.78 1,650,921.91
7. Earnings per share
7.1 Basic earnings per share
7.2 Diluted earnings per share
5. Consolidated Cash Flow Statement
Unit: RMB
Item H1 2019 H1 2018
1. Cash flows from operating activities:
Proceeds from sale of commodities
1,420,153,927.58 1,724,703,419.00
and rendering of services
Net increase in customer deposits and
interbank deposits
Net increase in borrowings from
central bank
Net increase in loans from other
financial institutions
Premiums received on original
insurance contracts
Net proceeds from reinsurance
Net increase in deposits and
investments of policy holders
Interest, handling charges and
commissions received
Net increase in interbank loans
obtained
Net increase in proceeds from
repurchase transactions
Net proceeds for acting trading of
securities
Tax rebates 83,274.78
Cash generated from other operating
17,859,351.29 90,788,801.98
activities
57
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Subtotal of cash generated from
1,438,013,278.87 1,815,575,495.76
operating activities
Payments for commodities and
1,439,403,589.85 1,550,475,876.47
services
Net increase in loans and advances to
customers
Net increase in deposits in central
bank and in interbank loans granted
Payments for claims on original
insurance contracts
Net increase in financial assets held
for trading
Net increase in interbank loans
granted
Interest, handling charges and
commissions paid
Policy dividends paid
Cash paid to and for employees 103,603,715.32 105,960,255.42
Taxes paid 35,598,899.66 49,419,836.97
Cash used in other operating
208,567,873.83 40,926,540.79
activities
Subtotal of cash used in operating
1,787,174,078.66 1,746,782,509.65
activities
Net cash generated from/used in
-349,160,799.79 68,792,986.11
operating activities
2. Cash flows from investing activities:
Proceeds from disinvestment
Return on investment 10,000,000.00
Net proceeds from the disposal of
fixed assets, intangible assets and other 16,739,630.00
long-lived assets
Net proceeds from the disposal of
subsidiaries and other business units
Cash generated from other investing
132,200,000.00
activities
Subtotal of cash generated from
142,200,000.00 16,739,630.00
investing activities
Payments for the acquisition of fixed 9,759,873.97 10,349,251.07
58
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
assets, intangible assets and other
long-lived assets
Payments for investments
Net increase in pledged loans granted
Net payments for the acquisition of
subsidiaries and other business units
Cash used in other investing
15,000,000.00
activities
Subtotal of cash used in investing
24,759,873.97 10,349,251.07
activities
Net cash generated from/used in
117,440,126.03 6,390,378.93
investing activities
3. Cash flows from financing activities:
Capital contributions received
Including: Capital contributions by
non-controlling interests to subsidiaries
Borrowings obtained 1,278,585,742.47 1,251,964,962.71
Net proceeds from issuance of bonds
Cash generated from other financing
33,400,956.90
activities
Subtotal of cash generated from
1,278,585,742.47 1,285,365,919.61
financing activities
Repayments of borrowings 901,879,065.08 1,238,924,743.47
Payments for interest and dividends 46,641,940.65 22,589,892.53
Including: Dividends paid by
subsidiaries to non-controlling interests
Cash used in other financing
26,501,660.17 159,238,064.51
activities
Subtotal of cash used in financing
975,022,665.90 1,420,752,700.51
activities
Net cash generated from/used in
303,563,076.57 -135,386,780.90
financing activities
4. Effect of foreign exchange rate
999,215.04 326,302.82
changes on cash and cash equivalents
5. Net increase in cash and cash
72,841,617.85 -59,877,113.04
equivalents
Add: Cash and cash equivalents,
133,983,939.73 254,251,911.75
beginning of the period
59
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
6. Cash and cash equivalents, end of the
206,825,557.58 194,374,798.71
period
6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item H1 2019 H1 2018
1. Cash flows from operating activities:
Proceeds from sale of commodities
and rendering of services
Tax rebates
Cash generated from other operating
46,286,613.99 115,499,945.32
activities
Subtotal of cash generated from
46,286,613.99 115,499,945.32
operating activities
Payments for commodities and
services
Cash paid to and for employees 652,205.17 715,331.00
Taxes paid -18,316.37
Cash used in other operating
40,031,650.81 140,718,960.55
activities
Subtotal of cash used in operating
40,665,539.61 141,434,291.55
activities
Net cash generated from/used in
5,621,074.38 -25,934,346.23
operating activities
2. Cash flows from investing activities:
Proceeds from disinvestment 5,000,000.00
Return on investment 10,000,000.00 3,214,180.81
Net proceeds from the disposal of
fixed assets, intangible assets and other
long-lived assets
Net proceeds from the disposal of
subsidiaries and other business units
Cash generated from other investing
activities
Subtotal of cash generated from
10,000,000.00 8,214,180.81
investing activities
Payments for the acquisition of fixed
60
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
assets, intangible assets and other
long-lived assets
Payments for investments
Net payments for the acquisition of
subsidiaries and other business units
Cash used in other investing
activities
Subtotal of cash used in investing
activities
Net cash generated from/used in
10,000,000.00 8,214,180.81
investing activities
3. Cash flows from financing activities:
Capital contributions received
Borrowings obtained
Net proceeds from the issuance of
bonds
Cash generated from other financing
activities
Subtotal of cash generated from
financing activities
Repayments of borrowings
Payments for interest and dividends 221,339.99 3,258,028.47
Cash used in other financing
activities
Subtotal of cash used in financing
221,339.99 3,258,028.47
activities
Net cash generated from/used in
-221,339.99 -3,258,028.47
financing activities
4. Effect of foreign exchange rate
changes on cash and cash equivalents
5. Net increase in cash and cash
15,399,734.39 -20,978,193.89
equivalents
Add: Cash and cash equivalents,
357,681.85 27,448,820.30
beginning of the period
6. Cash and cash equivalents, end of the
15,757,416.24 6,470,626.41
period
61
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
7. Consolidated Statements of Changes in Owners’ Equity
H1 2019
Unit: RMB
H1 2019
Equity attributable to owners of the Company as the parent
Other equity Other Non-c
Total
instruments Less: compr Surplu Retain ontroll
Item Share Capital Specifi Genera owners
Treasu ehensi s ed Subtot ing
capita Prefe Perpe reserve c l Other ’
ry ve reserve earnin al interes
l rred tual s reserve reserve equity
Other
share bond stock incom s gs ts
s s
e
1. Balances as 505,4 256,82 196,39 1,012, 1,970, 1,552, 3,523,
169,71
at the end of the 25,00 2,373. 9,250. 130,48 946,82 505,49 452,31
4.39
prior year 0.00 42 80 1.68 0.29 9.55 9.84
Add:
Adjustments for
changed
accounting
policies
Adjustments
for corrections
of previous
errors
Adjustments
for business
combinations
under common
control
Other 18,316 18,316 18,316
adjustments .37 .37 .37
2. Balances as 505,4 256,82 196,39 1,012, 1,970, 1,552, 3,523,
169,71
at the beginning 25,00 2,373. 9,250. 148,79 965,13 505,49 470,63
4.39
of the year 0.00 42 80 8.05 6.66 9.55 6.21
3. Increase/
-12,59 -14,82
decrease in the -2,229, -2,229,
7,580. 7,096.
period (“-” for 516.12 516.12
79 91
decrease)
3.1 Total 10,489 10,489 -12,59
-2,108,
comprehensive ,265.8 ,265.8 7,580.
314.99
income 0 0 79
62
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3.2 Capital
increased and
reduced by
owners
3.2.1
Ordinary shares
increased by
shareholders
3.2.2
Capital
increased by
holders of other
equity
instruments
3.2.3
Share-based
payments
included in
owners’ equity
3.2.4 Other
-12,71 -12,71 -12,71
3.3 Profit
8,781. 8,781. 8,781.
distribution
92 92 92
3.3.1
Appropriation
to surplus
reserves
3.3.2
Appropriation
to general
reserve
3.3.3
-12,71 -12,71 -12,71
Appropriation
8,781. 8,781. 8,781.
to owners (or
92 92 92
shareholders)
3.3.4 Other
3.4 Transfers
within owners’
equity
3.4.1
Increase in
63
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
capital (or share
capital) from
capital reserves
3.4.2
Increase in
capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4
Changes in
defined benefit
pension
schemes
transferred to
retained
earnings
3.4.5 Other
comprehensive
income
transferred to
retained
earnings
3.4.6 Other
3.5 Specific
reserve
3.5.1
Increase in the
period
3.5.2 Used
in the period
3.6 Other
4. Balances as 505,4 256,82 196,39 1,009, 1,968, 1,539, 3,508,
169,71
at the end of the 25,00 2,373. 9,250. 919,28 735,62 907,91 643,53
4.39
period 0.00 42 80 1.93 0.54 8.76 9.30
H1 2018
Unit: RMB
H1 2018
Item
Equity attributable to owners of the Company as the parent Non-co Total
64
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Other equity Other ntrollin owners’
instruments Less: compr Surplu Retain g equity
Share Capital Specifi Genera
Treasu ehensi s ed Subtot interest
capita Prefe Perp reserve c l Other
ry ve reserve earnin al s
l rred etual s reserve reserve
Other
share bond stock incom s gs
s s
e
1. Balances as 505,4 256,82 192,64 1,027, 1,982, 1,619,6 3,602,4
169,71
at the end of 25,00 2,373. 7,450. 794,89 859,43 31,324. 90,760.
4.39
the prior year 0.00 42 61 7.79 6.21 19 40
Add:
Adjustments
for changed
accounting
policies
Adjustments
for corrections
of previous
errors
Adjustments
for business
combinations
under common
control
Other
adjustments
2. Balances as
505,4 256,82 192,64 1,027, 1,982, 1,619,6 3,602,4
at the 169,71
25,00 2,373. 7,450. 794,89 859,43 31,324. 90,760.
beginning of 4.39
0.00 42 61 7.79 6.21 19 40
the year
3. Increase/
-37,35 -37,35
decrease in the -17,662 -55,016
3,596. 3,596.
period (“-” for ,549.28 ,146.21
93 93
decrease)
3.1 Total -15,29 -15,29
-17,662 -32,962
comprehensive 9,762. 9,762.
,549.28 ,312.07
income 79 79
3.2 Capital
increased and
reduced by
owners
3.2.1
65
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Ordinary shares
increased by
shareholders
3.2.2
Capital
increased by
holders of other
equity
instruments
3.2.3
Share-based
payments
included in
owners’ equity
3.2.4
Other
-22,05 -22,05
3.3 Profit -22,053
3,834. 3,834.
distribution ,834.14
14 14
3.3.1
Appropriation
to surplus
reserves
3.3.2
Appropriation
to general
reserve
3.3.3
-22,05 -22,05
Appropriation -22,053
3,834. 3,834.
to owners (or ,834.14
14 14
shareholders)
3.3.4
Other
3.4 Transfers
within owners’
equity
3.4.1
Increase in
capital (or
share capital)
from capital
66
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
reserves
3.4.2
Increase in
capital (or
share capital)
from surplus
reserves
3.4.3 Loss
offset by
surplus reserves
3.4.4
Changes in
defined benefit
pension
schemes
transferred to
retained
earnings
3.4.5
Other
comprehensive
income
transferred to
retained
earnings
3.4.6
Other
3.5 Specific
reserve
3.5.1
Increase in the
period
3.5.2 Used
in the period
3.6 Other
4. Balances as 505,4 256,82 192,64 990,44 1,945, 1,601,9 3,547,4
169,71
at the end of 25,00 2,373. 7,450. 1,300. 505,83 68,774. 74,614.
4.39
the period 0.00 42 61 86 9.28 91 19
67
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
8. Statements of Changes in Owners’ Equity of the Company as the Parent
H1 2019
Unit: RMB
H1 2019
Other equity
Other Retaine
instruments Less: Total
Item Capital compreh Specific Surplus d
Share
Preferr Perpet Treasury Other owners’
capital reserves ensive reserve reserves earning
ed ual Other stock equity
income s
shares bonds
1. Balances as at 505,42 777,19
250,531, 196,399, 1,729,549,
the end of the 5,000.0 3,693.6
482.00 250.80 426.44
prior year 0 4
Add:
Adjustments for
changed
accounting
policies
Adjustments
for corrections of
previous errors
Other 18,316.
18,316.37
adjustments 37
2. Balances as at 505,42 777,21
250,531, 196,399, 1,729,567,
the beginning of 5,000.0 2,010.0
482.00 250.80 742.81
the year 0 1
3. Increase/
decrease in the 15,554, 15,554,95
period (“-” for 951.78 1.78
decrease)
3.1 Total
15,554, 15,554,95
comprehensive
951.78 1.78
income
3.2 Capital
increased and
reduced by
owners
3.2.1
Ordinary shares
increased by
shareholders
68
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3.2.2
Capital increased
by holders of
other equity
instruments
3.2.3
Share-based
payments
included in
owners’ equity
3.2.4 Other
3.3 Profit
distribution
3.3.1
Appropriation to
surplus reserves
3.3.2
Appropriation to
owners (or
shareholders)
3.3.3 Other
3.4 Transfers
within owners’
equity
3.4.1
Increase in
capital (or share
capital) from
capital reserves
3.4.2
Increase in
capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4
Changes in
defined benefit
pension schemes
69
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
transferred to
retained earnings
3.4.5 Other
comprehensive
income
transferred to
retained earnings
3.4.6 Other
3.5 Specific
reserve
3.5.1
Increase in the
period
3.5.2 Used
in the period
3.6 Other
4. Balances as at 505,42 792,76
250,531, 196,399, 1,745,122,
the end of the 5,000.0 6,961.7
482.00 250.80 694.59
period 0 9
H1 2018
Unit: RMB
H1 2018
Other equity
Other
instruments Less: Total
Item Share Capital compre Specific Surplus Retained
Preferr Perpet Treasur Other owners’
capital reserves hensive reserve reserves earnings
ed ual Other y stock equity
income
shares bonds
1. Balances as 505,42
250,531 192,647 752,525,1 1,701,129,0
at the end of the 5,000.
,482.00 ,450.61 41.94 74.55
prior year 00
Add:
Adjustments for
changed
accounting
policies
Adjustments
for corrections
of previous
errors
Other
70
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
adjustments
2. Balances as 505,42
250,531 192,647 752,525,1 1,701,129,0
at the beginning 5,000.
,482.00 ,450.61 41.94 74.55
of the year 00
3. Increase/
decrease in the -7,446,72 -7,446,728.
period (“-” for 8.09 09
decrease)
3.1 Total
1,650,921 1,650,921.9
comprehensive
.91 1
income
3.2 Capital
increased and
reduced by
owners
3.2.1
Ordinary shares
increased by
shareholders
3.2.2
Capital
increased by
holders of other
equity
instruments
3.2.3
Share-based
payments
included in
owners’ equity
3.2.4 Other
3.3 Profit -9,097,65 -9,097,650.
distribution 0.00 00
3.3.1
Appropriation
to surplus
reserves
3.3.2
Appropriation -9,097,65 -9,097,650.
to owners (or 0.00 00
shareholders)
71
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3.3.3 Other
3.4 Transfers
within owners’
equity
3.4.1
Increase in
capital (or share
capital) from
capital reserves
3.4.2
Increase in
capital (or share
capital) from
surplus reserves
3.4.3 Loss
offset by
surplus reserves
3.4.4
Changes in
defined benefit
pension
schemes
transferred to
retained
earnings
3.4.5 Other
comprehensive
income
transferred to
retained
earnings
3.4.6 Other
3.5 Specific
reserve
3.5.1
Increase in the
period
3.5.2 Used
in the period
3.6 Other
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
4. Balances as 505,42
250,531 192,647 745,078,4 1,693,682,3
at the end of the 5,000.
,482.00 ,450.61 13.85 46.46
period 00
III Company Profile
Foshan Huaxin Packaging Co., Ltd. (hereinafter referred to as the Company) was sponsored and set by Foshan
Huaxin Development Co., Ltd., Foshan Municipal Investment General Corporation, Foshan Xinhui Industrial
Development Co., Ltd., China Packaging General Corporation, China Material Development & Investment
General Corporation, Guangdong Technical Reforming & Investment Co., Ltd., China Chemistry & Light
Industry General Corporation, and Foshan Light Industry Company under approval of People’s Government of
Guangdong Province with YBH (1999) No. 297 document and Economic System Reform Committee of
Guangdong Province with YTG (1999) No. 032 document, and was registered in Administration Bureau for
Commerce & Industry of Guangdong Province on 21 June 1999. The Company holds the business license with the
unified social credit code of 914406007076822793. And its registered capital is RMB505,425,000.00 with total
505,425,000.00 shares (RMB1 per share), among which, there are unrestricted public 171,925,000.00 B shares
and unrestricted private 333,500,000.00 B shares. The Company’s stocks were listed in Shenzhen Stock Exchange
for trade in 2000.
The Company is in the industry of papermaking, paper packaging and printing. Main business scope: mainly
manufactures (operated by subsidiary companies under the Company) and sells packaging materials, and
packaging products, materials for decoration and aluminum and plastic compound materials; sells and maintains
package machinery; invests in industry in terms of package and printing. Main products or services include
high-grade coated white cardboard, papermaking chemicals and color packages printing products, and etc.
The Company included five subsidiaries, Zhuhai Hongta Renheng Packaging Co., Ltd (hereinafter referred to as
Hongta Renheng), Zhuhai Huafeng Paper Co., Ltd (hereinafter referred to as Huafeng Paper), Zhuhai Golden
Pheasant Chemical Co., Ltd (hereinafter referred to as Golden Pheasant Chemical), Huaxin (Foshan) Color
Printing Co., Ltd. (hereinafter referred to as Foshan Color Printing), and Zhejiang Hongta Renheng Packaging
Technology Co., Ltd, into the scope of consolidated financial statement in the Reporting Period. For details, see
changes in consolidation scope of the notes to financial statement and the explanation for equities in other entities.
IV. Basis for the Preparation of Financial Statements
1. Preparation Basis
The financial statement of the Company was prepared on the base of the assumption of continuation.
2. Continuation
There was no such case where the sustainable operation ability within 12 months since the end of the Reporting
Period was highly doubted.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
V. Important Accounting Policies and Estimations
Indication of specific accounting policies and estimations:
Naught
1. Statement for Complying with the Accounting Standard for Business Enterprise
The financial statements for the Reporting Period prepared by the Company are in compliance with the
requirements of the accounting standard for business enterprise, and have reflected the Company’s financial status,
operating results and cash flows in an accurate and complete way.
2. Fiscal Period
The fiscal year of the Company is a solar calendar year, which is from 1 January to 31 December.
3. Operating Cycle
The operating cycle of the Company’s business is comparatively short with 12 months as the classification
standard for the mobility of assets and liabilities.
4. Standard Currency of Accounts
The Company adopts Renminbi as a standard currency of accounts.
5. Accounting Process of Business Combinations under the Same Control and not under the Same Control
1. Accounting Process of Business Combinations under the Same Control
The assets and liabilities that the Company obtains in a business combination shall be measured on the basis of
their carrying amount combined party in the consolidated financial statements of the final controller on the
combining date. As for the balance between the carrying amount of combined party’s owners equities in the
consolidated financial statements of the final controller and the carrying amount of the consideration paid by it or
the total par value of the shares issued), the additional paid-in capital shall be adjusted. If the additional paid-in
capital is not sufficient to be offset, the retained earnings shall be adjusted.
2. Accounting Process of Business Combinations not under the Same Control
The Company shall recognize the positive balance between the combination costs and the fair value of the
identifiable net assets obtained from the acquiree on purchase date as goodwill. If the combination costs are less
than the fair value of the identifiable net assets obtained from the acquire, the Company shall recheck the various
identifiable assets and liabilities obtained from the acquire, fair value with liabilities, and measurement of
combination costs. If the combination costs are less than the fair value of the identifiable net assets obtained from
the acquire after recheck, the Company shall the record the balance into the profit and loss of the current period.
6. Methods for Preparing Consolidated Financial Statements
The Company as the parent included its all subsidiaries into the consolidation scope of consolidated financial
statements. Based on the financial statements of the Company as the parent and its subsidiaries and other related
74
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
materials, the consolidated financial statements were prepared by the Company as the parent according to
Accounting Standards for Enterprises No. 33 –Consolidated Financial Statements.
7. Classification of Joint arrangements and Accounting Treatment of Joint Operations
1. Joint arrangement is classified into joint operation and joint ventures.
2. When the Company is a party of a joint operation, recognize the following items related to the profits in the
joint operation:
(1) Recognize the assets held independently, and recognize the assets held jointly in the holding portion;
(2) Recognize the liabilities borne independently, and recognize the liabilities held jointly in the holding portion;
(3) Recognize the revenue generated from the output portion of joint operation shared for selling the Company;
(4) Recognize the revenue generated from the sale of assets in joint operation in the holding portion of the
Company;
(5) Recognize the expenses incurred independently, and recognize the expenses incurred in joint operation in the
holding portion of the Company.
8. Recognition Standard for Cash and Cash Equivalents
The term “cash” listed and presented in the cash flow statement refers to cash on hand and deposits that are
available for payment at any time. The term “cash equivalents” refers to short-term and highly liquid investments
that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in
value.
9. Foreign Currency Businesses and Translation of Foreign Currency Financial Statements
1. Translation of Foreign Currency Business
As for a foreign currency transaction in its initial recognition, the amount in the foreign currency shall be
translated into the amount in the Renminbi at the spot exchange rate of the transaction date. On balance sheet date,
the foreign currency monetary items shall be translated as the spot exchange rate on the balance sheet date, the
balance occurred thereof shall be recorded into the profits and losses at the current period except that the balance
of exchange arising from the principal and interests of foreign currency borrowings for the purchase and
construction or production of assets eligible for capitalization. The foreign currency non-monetary items measured
at the historical cost shall still be translated at the spot exchange rate on the transaction date, of which the amount
of functional currency shall not be changed. The foreign currency non-monetary items measured at the fair value
shall be translated at the spot exchange rate on the confirming date of fair value, of which the balance of exchange
shall be included into the profit and loss of the current period or other comprehensive income.
2. Translation of Foreign Currency Financial Statements
The asset and liability items in the balance sheets shall be translated at a spot exchange rate on the balance sheet
date. Among the owner’s equity items, except for the items as “undistributed profits”, other items shall be
translated at the spot exchange rate at the time when they are incurred. The income and expense items in the profit
statements shall be translated at the spot exchange rate of the transaction date. The differences arising from the
translation of foreign currency financial statements in compliance with the aforesaid Items shall be recorded into
other comprehensive incomes.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
10. Financial Instruments
1. Classification of Financial Assets and Financial Liabilities
Financial assets shall be classified into the following four categories when they are initially recognized: the
financial assets which are measured at their fair values and the variation of which is recorded into the profits and
losses of the current period (including transactional financial assets and the financial assets which are measured at
their fair values and of which the variation is included in the current profits and losses); the investments which
will be held to their maturity; loans and the account receivables; and financial assets available for sale.
Financial liabilities shall be classified into the following two categories when they are initially recognized: the
financial liabilities which are measured at their fair values and of which the variation is included in the current
profits and losses (including transactional financial liabilities and the designated financial liabilities n its initial
recognition which are measured at their fair values and of which the variation is included in the current profits and
losses) and other financial liabilities.
2. Recognition Basis, Calculation Method, and Termination of Recognition of Financial Assets and Liabilities
When the Company becomes a party to a financial instrument, it shall recognize a financial asset or financial
liability. The financial assets and financial liabilities initially recognized shall be measured at their fair values. For
the financial assets and liabilities measured at their fair values and of which the variation is recorded into the
profits and losses of the current period, the transaction expenses thereof shall be directly recorded into the profits
and losses of the current period; for other categories of financial assets and financial liabilities, the transaction
expenses thereof shall be included into the initially recognized amount.
The Company shall make subsequent measurement on its financial assets according to their fair values, and may
not deduct the transaction expenses that may occur when it disposes of the said financial asset in the future.
However, those under the following circumstances shall be excluded: (1)The investments held until their maturity,
loans and accounts receivable shall be measured on the basis of the post-amortization costs by adopting the actual
interest rate method; (2) The equity instrument investments for which there is no quotation in the active market
and whose fair value cannot be measured reliably, and the derivative financial assets which are connected with the
said equity instrument and must be settled by delivering the said equity instrument shall be measured on the basis
of their costs.
The Company shall make subsequent measurement on its financial liabilities on the basis of the post-amortization
costs by adopting the actual interest rate method, with the exception of those under the following circumstances:
(1) For the financial liabilities measured at their fair values and of which the variation is recorded into the profits
and losses of the current period, they shall be measured at their fair values, and none of the transaction expenses
may be deducted, which may occur when the financial liabilities are settled in the future; (2) For the derivative
financial liabilities, which are connected to the equity instrument for which there is no quotation in the active
market and whose fair value cannot be reliably measured, and which must be settled by delivering the equity
instrument, they shall be measured on the basis of their costs; (3)For the financial guarantee contracts which are
not designated as a financial liability measured at its fair value and the variation thereof is recorded into the profits
and losses of the current period, and for the commitments to grant loans which are not designated to be measured
at the fair value and of which the variation is recorded into the profits and losses of the current period and which
will enjoy an interest rate lower than that of the market, a subsequent measurement shall be made after they are
initially recognized according to the higher one of the following: 1) the amount as determined according to the
Accounting Standards for Enterprises No. 13 - Contingencies; 2) the surplus after accumulative amortization as
determined according to the principles of the Accounting Standards for Enterprises No. 14 - Revenues is
subtracted from the initially recognized amount.
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Profits or losses from the change in fair value of financial assets or financial liabilities, unless related to hedging,
shall be treated in the following methods: (1) Profits or losses from the change in fair value of financial assets
measured by fair value and the changes included in the current gains and losses shall be included in gains from the
change in fair value; interests or cash dividends gained during asset holding shall be recognized as investment
income; at disposal, the difference between the amount actually received and the initially recognized amount shall
be recognized as investment income, and at the same time, income from the change in fair value shall be adjusted.
(2) The change in fair value of available-for-sale financial assets shall be included into other comprehensive
income; interests calculated in the actual interest rate method during the holding shall be included into investment
income; cash dividends from the investment of available-for-sale equity instruments shall be included into
investment income when the investee announces the issue of dividends; at disposal, the difference between the
amount actually received and the book value after deducting the cumulative amount of the change in fair value
originally included into other comprehensive income shall be recognized as investment income.
When the contractual right to receive the cash flow from a financial asset has been terminated or almost all the
risks and remunerations in respect of the ownership of the financial asset have been shifted, the financial asset
shall be derecognized; when the current obligations of a financial liability are fully or partially terminated, the
financial liability or a part of it shall be derecognized accordingly.
3. Recognition Basis and Measurement of Transfer of Financial Assets
Where the Company has transferred nearly all of the risks and rewards related to the ownership of the financial
asset to the transferee, it shall stop recognizing the financial asset. If it retained nearly all of the risks and rewards
related to the ownership of the financial asset, it shall continue to recognize the transferred financial asset, and
recognize the received consideration as a financial liability. Where the Company does not transfer or retain nearly
all of the risks and rewards related to the ownership of a financial asset, it shall deal with it according to the
circumstances as follows, respectively: (1) If it gives up its control over the financial asset, it shall stop
recognizing the financial asset; (2) If it does not give up its control over the financial asset, it shall, according to
the extent of its continuous involvement in the transferred financial asset, recognize the related financial asset and
recognize the relevant liability accordingly.
If the transfer of an entire financial asset satisfies the conditions for stopping recognition, the difference between
the amounts of the following 2 items shall be recorded in the profits and losses of the current period: (1) The book
value of the transferred financial asset; (2) The sum of consideration received from the transfer, and the
accumulative amount of the changes of the fair value originally recorded in the owner's equities. If the transfer of
partial financial asset satisfies the conditions to stop the recognition, the entire book value of the transferred
financial asset shall, between the portion whose recognition has been stopped and the portion whose recognition
has not been stopped, be apportioned according to their respective relative fair value, and the difference between
the amounts of the following two items shall be included into the profits and losses of the current period: (1)The
book value of the portion whose recognition has been stopped; (2)The sum of consideration of the portion whose
recognition has been stopped, and the portion of the accumulative amount of the changes in the fair value
originally recorded in the owner's equities which is corresponding to the portion whose recognition has been
stopped.
4. Recognition Method of Financial Assets and Financial Liabilities’ Fair Value
The Company adopts the valuation technique with sufficient useful data and supported by other information
which is suitable for the current situation to recognize the fair value of related financial assets and liabilities. The
Company classifies the input value used in the valuation technique into the following levels and uses them in
sequence:
(1) The first level of input value is the non-adjustable offer of the same assets or liabilities in the active market on
77
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
the calculation date;
(2) The second level of input value is the directly or indirectly observable input value of related assets or liabilities
except the input value on the first level, including: offer of similar assets or liabilities in the active market; offer of
identical or similar assets or liabilities in the non-active market; other observable input value except offer,
including the observable interest rate during the interval period of common offer, profit rate curve, etc.; the input
value for market verification etc..
(3) The third level of input value is the non-observable input value of related assets or liabilities, including interest
rates that cannot be observed directly or verified by the data of observable market, stock fluctuation rate, future
cash flow of the disposal obligation borne in corporate mergers, financial forecast based on self-data, etc..
5. Impairment Test and Withdrawal Method of Provision for the Impairment of Financial Assets
(1) Except for financial assets which are measured at their fair values and of which the variation is included in the
current profits and losses, the Company checks the book values of all other financial assets on the balance sheet
date. If there is objective evidence proving that a financial asset is impaired, an impairment provision is made.
(2) For held-to-maturity investments, loans and accounts receivable, financial assets with significant ingle
amounts shall be separated first, and carry out an impairment test independently. With regard to the financial
assets with insignificant single amounts, an independent impairment test may be carried out, or they may be
included in a combination of financial assets with similar credit risk features so as to carry out an
impairment-related test. Where, upon independent test, the financial asset (including those financial assets with
significant single amounts and those with insignificant amounts) has not been impaired, it shall be included in a
combination of financial assets with similar risk features so as to conduct another impairment test. If the test
results show that it has been impaired, the impairment losses shall be recognized according to the positive balance
between its carrying value and the estimated present value of future cash flow.
(3) Financial Assets Available for sale
1) The objective evidences that can prove the impairment of debt instrument available for sale in investment shall
include:
A serious financial difficulty occurs to the debtor;
The debtor breaches any of the contractual stipulations, for example, fails to pay or delays the payment of
interests or the principal, etc.;
The Company makes concession to the debtor which is in financial difficulties due to economic or legal factors,
etc.;
The debtor will probably become bankrupt or carry out other financial reorganizations;
)The debt instrument can no longer continue to be traded in the active market due to serious financial
difficulties of the debtor;
⑥Other objective evidences showing the impairment of the debt instrument available for sale
2) Objective evidences showing the impairment of equity instrument include: the fair value of the equity
instrument investment drops significantly or not temporarily; Any seriously disadvantageous change has occurred
to technical, market, economic or legal environment, etc. wherein the invested companies’ business, which makes
the Company unable to take back its cost of investment.
On balance sheet date, the Company separately examines each available-for-sale equity instrument investment. If
the fair value of the equity instruments which invests on the balance sheet date is lower than its initial investment
cost for more than 50% (including 50%) or lower than its initial investment cost for the duration time for more
than 12 months (including 12 months), which indicates that it had occurred impairment; if the fair value of the
equity instruments which invests on the balance sheet date is lower than its initial investment cost for more than
78
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
20% (including 20%) but not reach at 50%, or lower than its initial investment cost for the duration time for more
than 6 months (including 6 months) but not exceed 12 months, the Company will comprehensively considerate the
other relevant factors such as the price volatility etc. and will judge the equity investment whether had occurred
impairment. In respect of the equity instrument investment measured at cost, the Company determines whether
there is any impairment to the equity instrument by comprehensively considering whether there are any
unfavorable changes to the technical, market, economic or legal environment operated by the investee.
When there is any impairment to the available-for-sale financial assets measured at fair value, the accumulative
losses from decrease in fair value originally and directly recorded into other comprehensive income shall be rolled
out and included into impairment losses. As for the investment of available-for-sale debt instruments whose
impairment-related losses have been recognized, if, after the accounting period, the fair value has risen and is
objectively related to the subsequent events that occur after the originally impairment-related losses were
recognized, the originally recognized impairment-related losses shall be reversed and be recorded into the profits
and losses of the current period. As for the investment of available-for-sale equity instruments whose
impairment-related losses have been recognized, the increased fair value after the accounting period shall be
recorded into other comprehensive income.
When there is any impairment to the available-for-sale equity instruments measured at cost, the difference
between the book value of the equity instrument investment and the present value obtained from the discount of
future cash flow with the present market return of similar financial assets shall be recognized as impairment losses
and recorded into current profits or losses. Once recognized, the impairment losses shall not be reversed.
11. Notes Receivable
The difference of the present value of expected future cash flow less than its carrying value shall be withdrawn as
the bad debt provision for notes receivable.
12. Accounts Receivable
1. Accounts Receivable with significant amount which the Bad Debt Provision Is Withdrawn Individually
Recognition basis or amount standard An account receivable exceeds RMB10 million (inclusive)
for significant amount of individual
account receivable
Accounts receivable with significant An impairment test shall be conducted separately on the
single amount for which bad debt account receivable and the difference of the present value of
provision separately accrued at the expected future cash flow less than its carrying value shall be
period-end withdrawn as the bad debt provision.
2. Accounts Receivable which the Bad Debt Provision is Withdrawn by Credit Risk Characteristics
(1) Specific Group and Withdrawal Method of Bad Debt Provision
Withdrawal method of bad debt provision by credit risk characteristics
Aging group Aging analysis method
Amounts of related parties within the No bad debt provision
scope of consolidation
(2) Aging Analysis Method
Aging Withdrawal proportion of accounts receivable (%)
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
1-3 months ---
4-12 months 5.00
1-2 years 10.00
2-3 years 20.00
Over 3 years 50.00
3. Accounts Receivable with an Insignificant Single Amount but for which the Bad Debt Provision is Made
Individually
Reason of individually withdrawing There exists evidence that the Company unable to recover the
bad debt provision: account receivable in line with the original items.
Method of withdrawing bad debt An impairment test shall be conducted separately on the
provision account receivable and the difference of the present value of
expected future cash flow less than its carrying value shall be
withdrawn as the bad debt provision.
13. Financing Backed by Accounts Receivable
14. Other Receivables
Recognition method and accounting treatment method of expected credit losses of other receivables
1. Other Receivables with significant amount which the Bad Debt Provision Is Withdrawn Individually
Recognition basis or amount standard Other account receivable exceeds RMB10 million (inclusive)
for significant amount of individual
account receivable
Account receivable with significant An impairment test shall be conducted separately on the
single amount for which bad debt account receivable and the difference of the present value of
provision separately accrued at the expected future cash flow less than its carrying value shall be
period-end withdrawn as the bad debt provision.
2. Other Receivables which the Bad Debt Provision is Withdrawn by Credit Risk Characteristics
(1) Specific Group and Withdrawal Method of Bad Debt Provision
Withdrawal method of bad debt provision by credit risk characteristics
Aging group Aging analysis method
Amounts of related parties within the No bad debt provision
scope of consolidation
(2) Aging Analysis Method
Aging Withdrawal proportion of other
receivables (%)
1-3 months ---
4-12 months 5.00
80
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
1-2 years 10.00
2-3 years 20.00
Over 3 years 50.00
3. Other Receivables with an Insignificant Single Amount but for which the Bad Debt Provision is Made
Individually
Reason of individually withdrawing There exists evidence that the Company unable to recover the
bad debt provision: account receivable in line with the original items.
Method of withdrawing bad debt An impairment test shall be conducted separately on the
provision account receivable and the difference of the present value of
expected future cash flow less than its carrying value shall be
withdrawn as the bad debt provision.
15. Inventory
Is the Company subject to any disclosure requirements for special industries?
No
1. Category
Inventory was referred to the finished goods or commodities for sale, products in the process, materials in
production or providing services in daily activities, etc.
2. Pricing Method for Outgoing Inventories
Adopting the weighted average method for pricing at the end of the month at a time
3. Recognition basis of Net Realizable Value of Inventory
On the balance sheet date, inventory shall be measured at the lower of cost or net realizable value, and provision
shall be made for falling price of inventories on the ground of the difference between the cost of each item of
inventories and the net realizable value. Inventories directly for sale, under normal producing process, to the
amount after deducting the estimated sale expense and relevant taxes from the estimated sell price of the inventory,
the net realizable value has been recognized; inventories which need to be processed, under normal producing
process, to the amount after deducting the estimated cost of completion, estimated sale expense and relevant taxes
from the estimated sale price of produced finished goods, the net realizable value has been recognized; on the
balance sheet date, in the same item of inventories, if some have contractual price agreement while others do not,
the net realizable value shall be recognized respectively and compared with their cost, and the amount of
provision withdrawal or reversal for falling price of inventories shall be recognized respectively.
4. Inventory System for Inventories:
Inventory system: Perpetual inventory system
5. Amortization Method of the Low-value Consumption Goods and Packing Articles
(1) Low-value Consumption Goods
One-off amortization method
(2) Packing Articles
One-off amortization method
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Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
16. Contract Assets
17. Contract Costs
18. Assets Held for Sale
1. Classification of Non-current assets or disposal group Held for Sale
Non-current assets or disposal group are confirmed to be the components held for sale when the following
conditions are simultaneously satisfied: (1) According to the convention of similar transactions selling this kind of
assets or disposal group, they can be sold instantly in such conditions. (2) Sale is extremely likely to happen, that
is, the Company has made the decision of a sale plan, and got the confirmed purchase commitment. It is estimated
that the sale will be finished within 1 year.
Non-current assets or disposal groups specifically obtained by the Company for resale will be classified as
held-for-sale on the acquisition date when they meet the stipulated conditions of “expected to be sold within one
year” on the acquisition date, and may well satisfy the category of held-for-sale within a short time (which is
usually 3 months).
If any transaction between non-related parties fails to complete within one year due to one of the following
reasons outside the Company’s control, and the Company still commits to sell non-current assets or disposal
groups, the non-current assets or disposal groups shall be still classified as the held-for-sale category: (1) For
conditions of sale delay resulting from the accidental setting by the buyer or another party, the Company has duly
taken actions against those conditions and it is expected that the delay factors can be smoothly solved within one
year since the conditions of sale delay resulting from the setting; (2) Non-current assets or disposal groups held
for sale fail to be sold within one year due to rare circumstances, and the Company has taken necessary measures
against those new situations within the first year and re-satisfied the conditions for classifying them into the
held-for-sale category.
2. Measurement of held-for-sale non-current assets or disposal groups
(1) Initial measurement and subsequent measurement
For the initial measurement and the re-measurement of held-for-sale non-current assets or disposal groups on the
balance sheet date, if the book value is higher than the net amount of the fair value deducting the selling expenses,
the book value shall be written down to the net amount of the fair value deducting the selling expenses. The
written down amount shall be recognized as asset impairment losses and recorded into current profits or losses,
and at the same time, the held-for-sale asset impairment provision shall be withdrawn.
In respect of non-current assets or disposal groups classified into the held-for-sale category on the date of
obtainment, when initially measuring them, compare the initially measured amount supposing that they are not
classified into the held-for-sale category and the amount of the fair value deducting the selling expenses, and
measure them at the lower amount. Other than the non-current assets or disposal groups obtained in corporate
mergers, the difference generated from the net amount of the fair value of non-current assets or disposal groups
deducting the selling expenses as the initially measured amount shall be recorded into current profits or losses.
For the amount of asset impairment losses recognized in respect of held-for-sale disposal groups, first write off the
book value of goodwill in the disposal groups, and then write off their book value in proportion according to the
percentage of the book value of each non-current asset in the disposal groups.
Depreciation or amortization shall not be withdrawn for held-for-sale non-current assets or the non-current assets
in disposal groups, while the interests of liabilities and other expenses in held-for-sale disposal groups shall still
be recognized.
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(2) Accounting Methods for the Recovery of Assets Impairment Losses
If the net amount that the fair value of the non-current assets held for sale on the follow-up balance sheet date
minus the sale costs increases, the previous written-down amount will be restored, and reversed to the asset
impairment loss confirmed after the assets being classified as held-for-sale. The reversed amount will be included
in the current profit or loss. Impairment losses on assets recognized prior to classification as held for sale are not
reversed.
If the net amount that the fair value of the disposal groups held for sale on the follow-up balance sheet date minus
the sale costs increases, the previous written-down amount will be restored, and reversed to the asset impairment
loss confirmed after the assets being classified as held-for-sale. The reversed amount will be included in the
current profit or loss. The book value of deducted goodwill and the non-current assets applicable to the
measurement of held-for-sale categories will not be reversed if the asset impairment loss is recognized before it is
classified as held for sale.
For the subsequent reversal amount of the asset impairment loss recognized by the disposal group held for sale, its
book value shall be increased proportionately to the proportion of the book value of various non-current assets
measured by the disposal group in addition to goodwill.
(3) Accounting Methods for Ceasing to be classified as held-for-sale and Termination of Recognition
When a non-current asset or disposal group ceases to be classified as held-for-sale or a non-current asset is
removed out from the held-for-sale disposal group due to failure in meeting the classification conditions for the
category of held-for-sale, it will be measured by one of the followings whichever is lower: ① The book value
before being classified as held for sale will be adjusted according to the depreciation, amortization or impairment
that would have been recognized under the assumption that it was not classified as held for sale; ② The
recoverable amount.
When terminating the recognition of non-current assets or disposal group held for sale, the unconfirmed gains or
losses shall be recorded into the current profits and losses.
19. Investments in Debt Obligations
20. Other Investments in Debt Obligations
21. Long-term Receivables
22. Long-term Equity Investments
1. Judgment of Joint Control and Significant Influences
The term "joint control" refers to the joint control over an arrangement in accordance with the related agreements,
which does not exist unless the participants sharing the control power agree with each other about the related
arranged activity. The term "significant influences" refers to the power to participate in making decisions on the
financial and operating policies of an enterprise, but not to control or do joint control together with other parties
over the formulation of these policies.
2. Recognition of Investment Cost
(1) If the business combination is under the common control and the acquirer obtains long-term equity investment
in the consideration of cash, non-monetary asset exchange, bearing acquiree’s liabilities, or the issuance of equity
securities, the initial cost is the carrying amount of the proportion of the acquiree’s owner’s equity at the
acquisition date. The difference between the initial cost of the long-term equity investment and the carrying
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amount of the paid combination or the total amount of the issued shares should be adjusted to capital surplus. If
the capital surplus is not sufficient for adjustment, retained earnings are adjusted respectively.
When a long-term equity investment is formed from the business combination under common control through the
Company’s multiple transactions step by step, the treatment shall be carried out based on whether the transactions
constitute the “package deal”. If they do, the accounting treatment shall be carried out on the basis of assuming all
transactions as one transaction with the acquisition of control. If they do not, the initial investment cost shall be
the portion of the carrying value of acquiree’s net assets entitled in the consolidated financial statements of the
final controller after the consolidation. The difference between the initial investment cost of the long-term equity
investment on the combination date and the carrying value of the investment before the combination plus the
carrying value of the newly-paid consideration for the acquisition of the shares on the consolidation date shall be
adjusted to capital reserve; if the capital reserve is insufficient for the adjustment, retained earnings should be
adjusted accordingly.
(2) For those formed from the business combination under different control, the initial investment cost is the fair
value of the combination consideration paid on the acquisition date.
When a long-term equity investment is formed from the business combination under different control through the
Company’s multiple transactions step by step, the accounting treatment shall be carried out based on whether the
financial statements are individual or consolidated:
1) In individual financial statements, the initial investment cost accounted in cost method is the sum of the book
value of the equity investment originally held and the cost of new investment.
2) In consolidate financial statements, judge whether the transactions constitute the “package deal”. If they do, the
accounting treatment shall be carried out on the basis of assuming all transactions as one transaction with the
acquisition of control. If they do not, for the acquiree’s equity held before the acquisition date, re-measurement
shall be carried out according to the fair value of the equity on the acquisition date and the difference between the
fair value and the book value shall be recorded into current investment income; if the acquiree’s equity held
before the acquisition date involves other comprehensive income accounted in equity method, other
comprehensive income related to it shall be transferred into the income for the period in which the acquisition date
falls, with the exception of the other comprehensive incomes occurred because of the changes of net liabilities or
net assets of the defined benefit pension plans be re-measured for setting by the investees.
3) For those formed other than from business combination: If they are acquired in cash payment, the initial
investment cost is the purchase price actually paid; if they are acquired in the issue of equity securities, the initial
investment cost is the fair value of the issued equity securities; if they are acquired in debt restructuring, the initial
investment cost shall be recognized according to the Accounting Standards for Enterprises No. 12 - Debt
Restructuring; if they are acquired in the exchange of non-monetary assets, the initial investment shall be
recognized according to the Accounting Standards for Enterprises No. 7 - Exchange of Non-Monetary Assets.
3. Method of subsequent measurement and recognition of profits and losses
Long-term equity investment with control over investees shall be accounted in cost method; long-term equity
investment on associated enterprises and joint ventures shall be accounted in equity method.
4. Method of treating the disposal of the investment in a subsidiary stem by step through multiple transactions
until the loss of the controlling right
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(1) Individual financial statements
For the disposed equity, the difference between its fair value and the actually obtained price shall be recorded into
current profits or losses. For the residual equity, the part that still has significant effects on investees or with
common control jointly with other parties shall be accounted in equity method; the part that has no more control,
common control or significant effects on investees shall be recognized as financial assets and accounted in
accordance with the relevant regulation of the Accounting Standards for Enterprises No. 22 - Recognition and
Measurement of Financial Instruments.
(2) Consolidated financial statements
1) For the disposal of the investment in subsidiaries step by step until the loss of the controlling right through
multiple transactions, which do not constitute the “package deal”
Before the loss of the controlling right, for the balance between the disposal remuneration and the shares of net
assets in the subsidiaries that have been calculated since the acquisition date or combination date corresponding to
the disposal of long-term equity investment, capital reserve (capital premium) shall be adjusted, and if the capital
premium is not sufficient for the write-down, the retained earnings shall be written down.
At the loss of the controlling right over the original subsidiaries, the residual equity shall be re-measured at its fair
value on the date of losing the controlling right. The difference between the consideration obtained in the equity
disposal, plus the fair value of the remaining equities, less the Company’s share of net assets enjoyed of the
former subsidiary that has been calculated since the acquisition date or combination date according to the former
shareholding ratio, shall be recorded into the investment gains for the period when the control ceases; meanwhile,
goodwill shall be written down. Other comprehensive income related to former subsidiary's equity investment
shall be transferred into current investment income when the control ceases.
2) For the disposal of the investment in subsidiaries step by step until the loss of the controlling right through
multiple transactions, which constitute the “package deal”
The accounting treatment shall be carried out on the basis of considering each transaction as a transaction of
disposing the subsidiary and losing control. However, before losing control, the difference between each disposal
price before losing the control, and the corresponding net assets share enjoyed of subsidiary when disposing
long-term equity investment, shall be recognized as other comprehensive income in the consolidated financial
statements and when the control ceases, transferred into current profits or losses of the period of losing control.
23. Investment Property
Measurement model of investment real estate
Measurement of cost method
Depreciation or amortization method
1. The term "investment real estate" includes the right to use any land which has already been rented, the right to
use any land which is held and prepared for transfer after appreciation, and the right to use any building which has
already been rented.
2. The Company initially measures the investment property according to the costs, and adopts the cost method in
the subsequent measurement of investment property, and adopts the same methods with fixed assets and
intangible assets to withdraw depreciation or amortization.
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24. Fixed Assets
(1) Conditions for Recognition
The term "fixed assets" refers to the tangible assets that simultaneously possess the features as follows: they are held for the sake of
producing commodities, rendering labor service, renting or business management; and their useful life is in excess of one fiscal year.
No fixed asset may be recognized unless it simultaneously meets the conditions as follows: (1) The economic benefits are likely to
flow into the enterprise; (2) The cost of the fixed asset can be measured reliably.
(2) Depreciation Method
Expected net salvage
Category Depreciation method Depreciable life Annual deprecation
value
Houses and buildings Straight-line depreciation 30-40 5% 2.375%-3.17%
Machinery equipment Straight-line depreciation 10-25 5% 3.8%-9.5%
Transportation
Straight-line depreciation 5 5% 19%
equipment
Electronic equipment and
Straight-line depreciation 5-10 5% 9.5%-19%
other
(3) Recognition Basis, Pricing and Depreciation Method of Fixed Assets by Finance Lease
Where one of the following provisions is regulated in the rental agreement, it shall be recognized as an asset
acquired under finance leases: (1) the ownership of the leased asset is transferred to the lessee after the term of
lease expires; (2) the lessee has the option to buy the asset at a price which is far lower than the fair value of the
asset at the date when the option becomes exercisable; (3) the lease term covers the major part of the use life of
the leased asset [usually accounting for 75%(75% inclusive) of the use life of the leased asset]; (4) in the case of
the lessee, the present value of the minimum lease payments on the lease beginning date amounts to substantially
all of the fair value of the leased asset [above 90% (90% inclusive)]; in the case of the lessor, the present value of
the minimum lease payments on the lease beginning date amounts to substantially all of the fair value of the
leased asset [above 90% (90% inclusive)] (5) When nature of the leased asset is special, if there is no great
transform, only the Company can use it, As for the fixed assets by finance lease, the Company shall record the
lower one of the fair value of the leased asset and the present value of the minimum lease payments as the
entering value in an account, and make provision for depreciation according to the depreciation policy of
self-owned fixed assets.
25. Construction in Progress
1. No construction in progress may be recognized unless it simultaneously meets the conditions as follows: (1)
The economic benefits are likely to flow into the enterprise; (2) The cost of the fixed asset can be measured
reliably. Construction in progress shall be measured according to the occurred actual costs before the assets
available for the intended use.
2. When the construction in progress is available for the intended use, it shall be transferred to fixed assets
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according to the actual cost of the project. For construction in progress available for the intended use but not
dealing with final accounts of completed project, it shall be transferred to fixed assets according to the estimated
value first, and then adjust original temporarily estimated value based on the actual costs after the final accounts
of completed project, but not adjust the depreciation that was already calculated.
26. Borrowing Costs
1. Recognition Principle of Capitalization of Borrowing Costs
Where the borrowing costs incurred to the Company can be directly attributable to the acquisition and
construction or production of assets eligible for capitalization, it shall be capitalized and recorded into the costs of
relevant assets. Other borrowing costs shall be recognized as expenses when it occurred, and shall be recorded
into the current profits and losses.
2. Capitalization Period of Borrowings Costs
(1) The borrowing costs shall not be capitalized unless they simultaneously meet the following requirements: 1)
The asset disbursements have already incurred; 2) The borrowing costs have already incurred; 3) The acquisition
and construction or production activities which are necessary to prepare the asset for its intended use or sale have
already started.
(2) Where the acquisition and construction or production of a qualified asset is interrupted abnormally and the
interruption period lasts for more than 3 months, the capitalization of the borrowing costs shall be suspended. The
borrowing costs incurred during such period shall be recognized as expenses, and shall be recorded into the profits
and losses of the current period, till the acquisition and construction or production of the asset restarts.
(3) When the acquisition and construction or production of a qualified asset eligible for capitalization are
available for its intended use or sale, the capitalization of borrowing costs shall be stopped.
3. Capitalized rate and amount of borrowing costs
To the extent that funds are borrowed specifically for the purpose of acquiring or constructing a qualifying asset,
the amount of borrowing costs eligible for capitalization on that asset is determined as the actual interest costs
(including amortization of discount and premium confirmed according to effective interest method) incurred on
that borrowing during the period less any investment income on the temporary investment of the borrowing. To
the extent that funds are borrowed generally and used for the purpose of acquiring or constructing a qualifying
asset, the amount of borrowing costs eligible for capitalization shall be determined by applying a capitalization
rate to the weighted average of excess of accumulated expenditures on qualifying asset over that on specific
purpose borrowing.
27. Biological Assets
28. Oil-gas Assets
29. Right-of-use Assets
30. Intangible Assets
(1) Pricing Method, Useful Life and Impairment Test
1. Intangible assets include right to use land sites, patent right and non-patented technology, and conduct the initial
measurement according to the costs.
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2. With regard to intangible assets with limited service life, it shall be amortized systematically and reasonably
within their service life according to the expected implementation of economic interests related to the intangible
assets. If it can’t recognize the expected implementation reliably, it shall be amortized by straight-line method.
The specific useful lives are as follows:
Items Useful life for amortization (years)
Right to use land sites 50
Non-patented technology 10
Software and others 2-10
The intangible assets with uncertain service life shall not be amortized, and the Company rechecks the service life
of the intangible assets in every accounting period.
(2) Accounting Policies of Internal R&D Expenses
The expenses in research stage for its internal research and development projects shall be recorded into the current
profits and losses when it occurred. The expenses in development stage for its internal research and development
projects of the Company may be capitalized when they satisfy the following conditions simultaneously: (1) It is
feasible technically to finish intangible assets for use or sale; (2) It is intended to finish and use or sell the
intangible assets; (3) The usefulness of methods for intangible assets to generate economic benefits shall be
proved, including being able to prove that there is a potential market for the products manufactured by applying
the intangible assets or there is a potential market for the intangible assets itself or the intangible assets will be
used internally; (4) It is able to finish the development of the intangible assets, and able to use or sell the
intangible assets, with the support of sufficient technologies, financial resources and other resources; and (5) The
development expenditures of the intangible assets can be reliably measured.
Standard for Classifying the Expenses of Research Phase and Development Phase of the Company’s R&D
Projects
The term “research” refers to the creative and planned investigation to acquire and understand new scientific or
technological knowledge.
The term "development" refers to the application of research achievements and other knowledge to a certain plan
or design, prior to the commercial production or use, so as to produce any new material, device or product, or
substantially improved material, device and product.
The expenditures of R&D stage in internal R&D project, was recorded into current profits or losses.
31. Impairment of Long-term Assets
For long-term assets, such as long-term equity investment, investment property measured by cost model, fixed
assets, construction in progress, and intangible assets with limited service life, the Company shall estimate the
recoverable amount if there are signs of impairment on balance sheet date. For intangible assets with uncertain
goodwill or service life formed by enterprise combination, whether or not there is sign of impairment, impairment
test shall be conducted every year. Goodwill combination and its related assets group or combination of assets
group shall be conducted the impairment test.
If the recoverable amount of the above-mentioned long-term assets is lower than its carrying value, it shall make
the preparation for assets impairment based on its balance and be recorded into current profits and losses.
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32. Long-term Deferred Expenses
Long-term deferred expenses refer to general expenses with the amortized period over one year (one year
excluded) that have occurred. Long-term deferred expense shall be recorded into the account according to the
actual accrual. Long-term deferred expense shall be amortized averagely within benefit period or specified period.
In case of no benefit in the future accounting period, the amortized value of such project that fails to be amortized
shall be transferred into the profits and losses of the current period.
33. Contract Liabilities
34. Payroll
(1) Accounting Treatment of Short-term Compensation
During the accounting period when the employees providing the service for the Company, the actual short-term
compensation shall be recognized as liabilities, and be recorded into the current profits and losses or related assets
costs.
(2) Accounting Treatment of the Welfare after Demission
The Company's welfare after demission plans is divided into defined contribution plans and defined benefit plans
(1) During the accounting period when the employee providing service for the Company, the amount paid in line
with the setting drawing plan will be recognized as liabilities and recorded into current profits or losses or cost of
relevant assets.
(2) The accounting treatment of defined benefit plans usually consists of the following steps:
1) According to the expected cumulative welfare unit method, adopt unbiased and mutually consistent actuarial
assumptions to evaluate related demographic variables and financial variables, measure the obligations generated
from defined benefit plans and recognize the period in respect of related obligations. Meanwhile, discount the
obligations generated from defined benefit plans to recognize their present value and the current service costs;
2) If there are any assets in a defined benefit plan, the deficit or surplus formed from the present value of the
defined benefit plan obligations less the fair value of the defined benefit plan assets shall be recognized as net
liabilities or net assets of a defined benefit plan. If there is any surplus in a defined benefit plan, the net assets of
the plan shall be measured at the lower of the surplus or the upper asset limit;
3) At the end of the period, the staff remuneration costs generated from a defined benefit plan shall be recognized
as services costs, net interests of the net liabilities or net assets of the plan and changes from the re-measurement
of the net liabilities or net assets of the plan. Service costs and net interests of the net liabilities or net assets of the
plan shall be recorded into the current profits or losses or related asset costs, while changes from the
re-measurement of the net liabilities or net assets of the plan shall be recorded into other comprehensive income
and shall not be transferred back to profits or losses in subsequent accounting periods. But the amounts recognized
in other comprehensive income may be transferred within the equity scope.
(3) Accounting Treatment of Demission Welfare
When the Company is unable to unilaterally withdraw the plan on the cancellation of labor relationship or the
layoff proposal, or when recognizing the costs or expenses (the earlier one between the two) related to the
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reorganization of paying the demission welfare, should recognize the payroll liabilities from the demission
welfare and include in the current gains and losses.
(4) Accounting Treatment of Other Long-term Welfare for Employees
The Company provides the other long-term employee benefits for the employees, and for those met with the
defined contribution plans, accounting treatment should be conducted according to the related regulations of the
defined contribution plans; the for the others long-term employee benefits except for the former, accounting
treatment should be conducted according to the related regulations of the defined benefit plans. In order to
simplify the related accounting treatment, the payrolls shall be recognized as service costs, the net amount of
interest of net liabilities and net assets of other welfare of the long-term employees. The total net amounts made
up from the changes of measuring the net liabilities and net assets of other welfare of the long-term employees
again shall be recorded into the current profits and losses or related assets costs.
35. Leasing Liabilities
36. Provisions
1. The obligation such as external guaranty, litigation or arbitration, product quality assurance, loss contract,
pertinent to a contingencies shall be recognized as an estimated debts when the following conditions are satisfied
simultaneously: ① That obligation is a current obligation of the enterprise; ② It is likely to cause any economic
benefit to flow out of the enterprise as a result of performance of the obligation; and ③ The amount of the
obligation can be measured in a reliable way.
2. The Company shall conduct the initial measurement to accrued liabilities according to the best estimate number
needed for performing the related current obligation and recheck the carrying value of accrued liabilities on
balance sheet date.
37. Share-based Payment
38. Other Financial Instruments such as Preferred Shares and Perpetual Capital Securities
39. Revenue
Is the Company subject to any disclosure requirements for special industries?
No
Has implemented new standards governing revenue or not
□ Applicable √ Not applicable
1. Revenue Recognition Principle
(1) Sale of goods
No revenue from selling goods may be recognized unless the following conditions are met simultaneously: 1) The
significant risks and rewards of ownership of the goods have been transferred to the buyer by the Company; 2)The
Company retains neither continuous management right that usually keeps relation with the ownership nor
effective control over the sold goods; 3) The revenue amount could be reliably measured; 4) The relevant
economic benefits may flow into the Company; and 5) the relevant cost which had occurred or will occur could be
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reliably measured.
(2) Providing labor services
If the provision of labor services can be reliably estimated (all the following conditions are met: ① The amount of
income can be measured reliably; ②The relevant economic benefits are likely to inflow to the Company; ③ The
progress of the transaction can be reliably determined; ④ The cost incurred and to be incurred in the transaction
can be measured reliably), it shall recognize the revenue from providing services employing the
percentage-of-completion method, and confirm the completion of labor service according to the costs incurred as
a percentage of the total estimated costs. If the Company can’t, on the date of the balance sheet, reliably estimate
the outcome of a transaction concerning the labor services it provides, it shall be handled under the following
conditions: If the cost of labor services incurred is expected to be compensated, the revenue from the providing of
labor services shall be recognized in accordance with the amount of the cost of labor services incurred, and the
cost of labor services shall be carried forward at the same amount; If the cost of labor services incurred is not
expected to compensate, the cost incurred should be included in the current profits and losses, and no revenue
from the providing of labor services may be recognized.
(3) Transferring the Right to Use Assets
The revenue of transferring the right to use assets may not be recognized unless the following conditions are both
met: the relevant economic benefits are likely to inflow to the Company; and the revenue can be reliably measured.
The interest income shall be recognized according to the time and actual interest rate in which other people use
the Company’s monetary funds. Royalty revenue shall be recognized according to the chargeable time and method
stipulated in related contracts and agreements.
2. Confirmation methods of sales revenues
(1) Confirmation methods of domestic sales revenue
Shall satisfy following conditions: products should be delivered according to customer’s requirements and signed
by customers; amount of sales revenues is determined, received or respected to receive; sales slip should be
invoiced; costs of sold products should be calculated;
(2) Confirmation methods of export sales revenue
Shall satisfy following conditions: products should be produced according to export sales agreement signed with
customers, received export declaration and obtained bill of lading (waybill); amount of sales revenues is
determined, received or respected to receive; sales slip should be invoiced; costs of sold products should be
calculated.
If the collection of the price as stipulated in the contract or agreement is delayed and if it has the financing nature,
the revenue incurred by selling goods shall be ascertained in accordance with the fair value of the receivable price
as stipulated in the contract or agreement.
40. Government Subsidies
1. If the government subsidies meet with the following conditions at the same, it should be recognized: (1) The
entity will comply with the condition attaching to them; (2) The grants will be received from government. If a
government subsidy is a monetary asset, it shall be measured according to the amount received or receivable. If a
government subsidy is a non-monetary asset, it shall be measured at its fair value, and shall be measured at a
nominal amount when the fair value cannot be obtained reliably.
2. Judgment basis and accounting methods of government subsidies related to assets
The government subsidies that are acquired for construction or form long-term assets in other ways according to
government documents shall be defined as asset-related government subsidies. For those not specified in
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government documents, the judgment shall be made based on the compulsory fundamental conditions for
acquiring the subsidies. If the subsidies are acquired with construction or the formation of long-term assets in
other ways as fundamental conditions, they shall be recognized as asset-related government subsidies. For
asset-related government subsidies, the book value of related assets shall be written down or recognized as
deferred income. If asset-related government subsidies are recognized as deferred income, it shall be recorded into
profits or losses by period in a reasonable and systemic manner within the life of related assets. Government
subsidies measured at the nominal amount shall be directly recorded into current profits or losses. If related assets
are sold, transferred, disposed of or destroyed before the end of their life, the undistributed balance of related
deferred income shall be transferred into the profits or losses for the period of the asset disposal.
3. Judgment basis and accounting treatment of profits-related government subsidies
Government subsidies other than asset-related government subsidies shall be defined as profits-related
government subsidies. For government subsidies consisting of both asset-related parts and profits-related parts,
which are difficult to judge whether they are related to assets or profits, the entirety shall be classified as
profits-related government subsidies. Profits-related government subsidies that are used to compensate the related
future expenses or losses shall be recognized as deferred income and shall be included into the current
profit/losses or write down related costs during the period when the relevant expenses or losses are recognized;
those subsidies used to compensate the related expenses or losses incurred shall be directly included into the
current profits/losses or write down related costs.
4. Government subsidies related to the Company’s routine operating activities shall be included into other income
or write down related costs according to the economic business nature. Government subsidies not related to the
Company’s routine activities shall be included into non-operating income and expenditure.
41. Deferred Income Tax Assets/Deferred Income Tax Liabilities
1. In accordance with the balance (the item not recognized as assets and liabilities can confirm their tax bases
according to the tax law, the balance between the tax bases and its carrying amount) between the carrying amount
of assets or liabilities and their tax bases, deferred tax assets and deferred tax liabilities should be recognized at
the tax rates that are expected to apply to the period when the asset is realized or the liability is settled.
2. A deferred tax asset shall be recognized within the limit of taxable income that is likely to be obtained to offset
the deductible temporary differences. At the balance sheet date, where there is strong evidence showing that
sufficient taxable profit will be available against which the deductible temporary difference can be utilized, the
deferred tax asset unrecognized in prior period shall be recognized.
3. The Company assesses the carrying amount of deferred tax asset at the balance sheet date. If it’s probable that
sufficient taxable profit will not be available against which the deductible temporary difference can be utilized,
the Company shall write down the carrying amount of deferred tax asset, or reverse the amount written down later
when it’s probable that sufficient taxable profit will be available.
4. The current income tax and deferred income tax of the Company are recorded into the current gains and losses
as income tax expenses or revenue, except in the following circumstances:
(1) Business combination
(2) The transaction or event directly included in owner’ equity
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42. Lease
(1) Accounting Treatment of Operating Lease
As a Lessee, the Company shall record the rent into relevant assets cost or recognize it as the current profit or loss
on a straight-line basis over the lease term. The initial direct costs incurred shall be recognized as the current
profit or loss; Contingent rents shall be charged into the current profit or loss when they are incurred.
As a lessor, the Company shall recognize the rent as the current profit or loss on a straight-line basis over the lease
term. Initial direct costs incurred by the lessor shall be directly recognized as the current profit or loss except that
costs with larger amounts shall be capitalized and recorded into the current profit and loss by stages; Contingent
rents shall be charged into the current profit or loss when they are incurred.
(2) Accounting Treatments of Financial Lease
For the lessee, a fixed asset acquired under finance lease shall be valued at the lower of the fair value of the leased
asset and the present value of the minimum lease payments at the inception of lease. The minimum lease
payments as the entering value in long-term account payable, the difference as unrecognized financing charges;
the initial direct costs shall be directly recorded into leasing asset value. At each period during the lease term, the
effective interest rate method shall be adopted to calculate and confirm the current financing charge.
On the initial date of financial lease, lessee of the financial lease shall record the sum of the minimum lease
payments and initial direct costs as the financing lease accounts receivable, and also record the non-guaranteed
residual value; recognize the difference between the total minimum lease payments, initial direct costs,
non-guaranteed residual value and sum of the present value as the unrealized financing income; At each period
during the lease term, the effective interest rate method shall be adopted to calculate and confirm the current
financing income.
43. Other Significant Accounting Policies and Estimates
44. Changes in Main Accounting Policies and Estimates
(1) Change of Accounting Policies
√ Applicable □ Not applicable
Changes to the accounting policies and
Approval process Remark
why
On 31 March 2017, the Ministry of
Finance issued the revised versions of the
For further information, see the
Accounting Standard No. 22 for Business
The changes to the accounting policies Announcement on Changes to the
Enterprises—Recognition and
were approved at the Second Meeting of Accounting Policies disclosed by the
Measurement of Financial Instruments
the Seventh Board of Directors of the Company on the designated media for
(CK [2017] No. 7), the Accounting
Company of 2019 on 15 March 2019. information disclosure dated 17 March
Standard No. 23 for Business
2019.
Enterprises—Transfer of Financial Assets
(CK [2017] No. 8), the Accounting
93
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Standard No. 24 for Business
Enterprises—Hedge Accounting (CK
[2017] No. 9) and the Accounting Standard
No. 37 for Business
Enterprises—Presentation of Financial
Instruments (CK [2017] No. 14). The
Company has adopted the aforesaid new
accounting standards in its accounting
treatment since 1 January 2019.
On 15 June 2018, the Ministry of Finance
issued the Document CK [2018] No. 15,
revising the format of financial statements
of general enterprises. The non-financial
enterprises adopting the Accounting
Standards for Business Enterprises are For further information, see the
required to prepare their financial The changes to the accounting policies Announcement on Changes to the
statements according to the revised format were approved at the Second Meeting of Accounting Policies disclosed by the
(applicable to enterprises that have not yet the Seventh Board of Directors of the Company on the designated media for
adopted the new accounting standards Company of 2019 on 15 March 2019. information disclosure dated 17 March
governing financial instruments and 2019.
revenue). In accordance with the
Document, the Company has adjusted the
relevant financial statements items and the
comparative data of the comparable
accounting period.
(2) Changes in Accounting Estimates
□ Applicable √ Not applicable
(3) Adjustments to the Financial Statements at the Beginning of the First Execution Year of any New
Standards Governing Financial Instruments, Revenue or Leases
√ Applicable □ Not applicable
Consolidated balance sheet:
Unit: RMB
Item 31 December 2018 1 January 2019 Adjustment
Current assets:
Monetary capital 133,983,939.73 133,983,939.73
Settlement reserve
Interbank loans granted
Trading financial assets
94
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Financial assets at fair
value through profit or loss
Derivative financial assets
Notes receivable 277,623,928.13 277,623,928.13
Accounts receivable 781,215,643.89 781,215,643.89
Financing backed by
accounts receivable
Prepayments 114,855,049.09 114,855,049.09
Premiums receivable
Reinsurance receivables
Receivable reinsurance
contract reserve
Other receivables 26,332,955.74 26,332,955.74
Including: Interest
7,800,232.76 7,800,232.76
receivable
Dividends
receivable
Financial assets purchased
under resale agreements
Inventories 1,022,167,373.51 1,022,167,373.51
Contract assets
Assets classified as held
for sale
Current portion of
non-current assets
Other current assets 338,311,849.45 338,311,849.45
Total current assets 2,694,490,739.54
Non-current assets:
Loans and advances to
customers
Investments in debt
obligations
Available-for-sale financial
288,700.00
assets
Investments in other debt
obligations
Held-to-maturity
95
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
investments
Long-term receivables
Long-term equity
662,590,158.00
investments
Investments in other equity
instruments
Other non-current financial
assets
Investment property 30,763,683.73 30,763,683.73
Fixed assets 2,178,817,683.33 2,178,817,683.33
Construction in progress 38,735,958.38 38,735,958.38
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 131,907,260.76
R&D expense 7,752,439.97
Goodwill 11,547,305.29
Long-term prepaid
4,755,506.18 4,755,506.18
expense
Deferred income tax assets 31,549,345.48 31,549,345.48
Other non-current assets 1,495,963.49 1,495,963.49
Total non-current assets 3,100,204,004.61
Total assets 5,794,694,744.15
Current liabilities:
Short-term borrowings 862,776,823.86 862,776,823.86
Borrowings from central
bank
Interbank loans obtained
Trading financial liabilities
Financial liabilities at fair
value through profit or loss
Derivative financial
liabilities
Notes payable 310,600,000.00 310,600,000.00
Accounts payable 464,643,787.56 464,643,787.56
Advances from customers 33,431,588.79 33,431,588.79
96
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Financial assets sold under
repurchase agreements
Customer deposits and
interbank deposits
Payables for acting trading
of securities
Payables for underwriting
of securities
Payroll payable 44,817,842.45 44,817,842.45
Taxes payable 41,288,520.29 41,288,520.29
Other payables 179,737,877.39 179,737,877.39
Including: Interest
6,315,962.71 6,315,962.71
payable
Dividends
25,083,228.68 25,083,228.68
payable
Handling charges and
commissions payable
Reinsurance payables
Contract liabilities
Liabilities directly
associated with assets
classified as held for sale
Current portion of
200,000,000.00 200,000,000.00
non-current liabilities
Other current liabilities
Total current liabilities 2,137,296,440.34
Non-current liabilities:
Insurance contract reserve
Long-term borrowings 100,000,000.00 100,000,000.00
Bonds payable
Including: Preferred
shares
Perpetual
bonds
Lease liabilities
Long-term payables
Long-term payroll payable
97
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Provisions 1,508,735.64 1,508,735.64
Deferred income 30,305,313.30 30,305,313.30
Deferred income tax
2,131,935.03 2,131,935.03
liabilities
Other non-current
liabilities
Total non-current liabilities 133,945,983.97
Total liabilities 2,271,242,424.31
Owners’ equity:
Share capital 505,425,000.00 505,425,000.00
Other equity instruments
Including: Preferred
shares
Perpetual
bonds
Capital reserves 256,822,373.42 256,822,373.42
Less: Treasury stock
Other comprehensive
169,714.39 169,714.39
income
Specific reserve
Surplus reserves 196,399,250.80 196,399,250.80
General reserve
Retained earnings 1,012,130,481.68 1,012,148,798.05
Total equity attributable to
owners of the Company as 1,970,946,820.29
the parent
Non-controlling interests 1,552,505,499.55
Total owners’ equity 3,523,452,319.84
Total liabilities and owners’
5,794,694,744.15
equity
Notes to the adjustments:
Balance sheet of the Company as the parent:
Unit: RMB
Item 31 December 2018 1 January 2019 Adjustment
Current assets:
Monetary capital 357,681.85
98
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Trading financial assets
Financial assets at fair
value through profit or loss
Derivative financial assets
Notes receivable
Accounts receivable
Financings backed by
accounts receivable
Prepayments
Other receivables 61,127,498.79 61,127,498.79
Including: Interest
4,481,906.67 4,481,906.67
receivable
Dividends
receivable
Inventories
Contract assets
Assets classified as held
for sale
Current portion of
non-current assets
Other current assets 45,344.03
Total current assets 61,530,524.67
Non-current assets:
Investments in debt
obligations
Available-for-sale financial
288,700.00
assets
Investments in other debt
obligations
Held-to-maturity
investments
Long-term receivables
Long-term equity
1,719,127,360.28 1,719,127,360.28
investments
Investments in other equity
instruments
Other non-current financial
99
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
assets
Investment property
Fixed assets 89,328.44
Construction in progress
Productive living assets
Oil and gas assets
Right-of-use assets
Intangible assets 95,808.24
R&D expense
Goodwill
Long-term prepaid
168,411.39
expense
Deferred income tax assets
Other non-current assets
Total non-current assets 1,719,769,608.35
Total assets 1,781,300,133.02
Current liabilities:
Short-term borrowings
Trading financial liabilities
Financial liabilities at fair
value through profit or loss
Derivative financial
liabilities
Notes payable
Accounts payable
Advances from customers
Contract liabilities
Payroll payable 10,500.40
Taxes payable 1,214.50
Other payables 51,738,991.68
Including: Interest
2,536,586.20
payable
Dividends
229,593.13
payable
Liabilities directly
associated with assets
100
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
classified as held for sale
Current portion of
non-current liabilities
Other current liabilities
Total current liabilities 51,750,706.58
Non-current liabilities:
Long-term borrowings
Bonds payable
Including: Preferred
shares
Perpetual
bonds
Lease liabilities
Long-term payables
Long-term payroll payable
Provisions
Deferred income
Deferred income tax
liabilities
Other non-current
liabilities
Total non-current liabilities
Total liabilities 51,750,706.58
Owners’ equity:
Share capital 505,425,000.00
Other equity instruments
Including: Preferred
shares
Perpetual
bonds
Capital reserves 250,531,482.00
Less: Treasury stock
Other comprehensive
income
Specific reserve
Surplus reserves 196,399,250.80
101
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Retained earnings 777,193,693.64
Total owners’ equity 1,729,549,426.44
Total liabilities and owners’
1,781,300,133.02
equity
Notes to the adjustments:
(4) Retroactive Adjustments to Comparative Data of Prior Years when First Execution of any New
Standards Governing Financial Instruments or Leases
□ Applicable √ Not applicable
45. Other
VI Taxes
1. Main Taxes and Tax Rates
Category of taxes Tax basis Tax rate
VAT Sale of goods or rendering taxable services 5%、6%、9%、11%、13%
Urban maintenance and construction tax Turnover tax actually paid 7%、5%
Enterprise income tax Taxable income 25%、15%
For taxation according to price, it shall pay
1.2% of the residual value of original
Property tax property value subtracting 30%; for 1.2%、12%
taxation according to rent, it shall pay 12%
of rental income
Education surcharge Turnover tax actually paid 3%
Local education surcharge Turnover tax actually paid 2%
Notes of the disclosure situation of the taxpaying bodies with different enterprises income tax rate
Name Income tax rate
The Company 25%
Hongta Renheng 15%
Zhuhai Huafeng 15%
Golden Pheasant Chemical 15%
Huaxin Color Printing 15%
Zhejiang Hongta 25%
102
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2. Tax Preference
(1) According to the Notice on Issuing the First Name List of Proposed Hi-tech Enterprise in Guangdong Province
for Y2018 published issued by Science & Technology Department of Guangdong Province, Hongta Renheng, the
Company’s subsidiary, passed the reaffirmation of First Batch of Hi-tech Enterprise in Guangdong Province for
Y2018, and gained Certificate for Hi-tech Enterprise (Certificate No.: GR201844005432, with three years of
validity). Hongta Renheng shall pay the corporate income tax according to the corporate income tax rate of 15%
in 2019.
(2) According to the First Name List of Proposed Hi-tech Enterprise in Guangdong Province for Y2016 published
by the National Leading Group Office for the Management of High-tech Enterprises Recognition, Zhuhai
Huafeng Paper, the Company’s subsidiary, passed the affirmation of First Batch of Proposed Hi-tech Enterprise in
Guangdong Province for Y2016, and gained Certificate for Hi-tech Enterprise (Certificate No.: GR201644001293,
with three years of validity). Zhuhai Huafeng Paper reapplied for the affirmation of Hi-tech Enterprise in 2019,
and the result has not come out yet. Thus Zhuhai Huafeng Paper shall pay the corporate income tax according to
the corporate income tax rate of 15% for the time being.
(3) According to the Notice on Issuing the Second Name List of Proposed Hi-tech Enterprise in Guangdong
Province for Y2016 published by the National Leading Group Office for the Management of High-tech
Enterprises Recognition, Golden Pheasant Chemical, the Company’s subsidiary, passed the reaffirmation of
Hi-tech Enterprise, and gained Certificate for Hi-tech Enterprise (Certificate No.: GR201644004219, with three
years of validity). Golden Pheasant Chemical reapplied for the affirmation of Hi-tech Enterprise in 2019, and the
result has not come out yet. Thus Golden Pheasant Chemical shall pay the corporate income tax according to the
corporate income tax rate of 15% for the time being.
(4) According to the Notice on Issuing the Second Name List of Proposed Hi-tech Enterprise in Guangdong
Province for Y2018 jointly issued by Science & Technology Department of Guangdong Province, Department of
Finance of Guangdong Province, Guangdong Provincial Office, SAT, Guangdong Local Taxation Bureau, the
subsidiary of the Company Huaxin (Foshan) Color Printing, passed the reaffirmation of high-tech enterprise of
2018 and the gained the Certification of Hi-tech Enterprise (Certificate No.: GR201844009816, with three years
of validity). Thus Huaxin (Foshan) Color Printing shall pay the corporate income tax according to the corporate
income tax rate of 15% in 2019.
3. Other
VII. Notes to Major Items in the Consolidated Financial Statements of the Company
1. Monetary Capital
Unit: RMB
Item Ending balance Beginning balance
Cash on hand 223,619.39 131,195.64
Bank deposits 206,601,938.19 127,881,489.59
Other monetary capital 10,501,660.17 5,971,254.50
Total 217,327,217.75 133,983,939.73
Other notes:
103
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Other monetary capital at the period-end is the letter of guarantee of RMB10,501,660.17. For the money with
restriction on usage, the Company has already gotten rid of it from the balance of cash and cash equivalents at the
period-end when prepared the cash flow statement.
2. Trading Financial Assets
Unit: RMB
Item Ending balance Beginning balance
Of which:
Of which:
Other notes:
3. Derivative Financial Assets
Unit: RMB
Item Ending balance Beginning balance
Other notes:
4. Notes Receivable
(1) Notes Receivable Listed by Category
Unit: RMB
Item Ending balance Beginning balance
Bank acceptance bill 583,201,578.53 271,186,964.94
Commercial acceptance bill 3,512,477.99 6,436,963.19
Total 586,714,056.52 277,623,928.13
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category Withdra Withdraw
Carrying Carrying
Proportio wal Proportio al
Amount Amount value Amount Amount value
n proportio n proportio
n n
Of which:
Of which:
Bad debt provision separately accrued:
Unit: RMB
Name Ending balance
104
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Carrying amount Bad debt provision Withdrawal proportion Withdrawal reason
Bad debt provision withdrawn according to groups:
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion
Notes of the basis of recognizing the group:
If the bad debt provision for notes receivable was withdrawn in accordance with the general model of expected credit losses,
information related to bad debt provision shall be disclosed by reference to the disclosure method of other receivables:
□ Applicable √ Not applicable
(2) Bad Debt Provision Withdrawn, Reversed or Collected during the Reporting Period
Bad debt provision withdrawn in the Reporting Period:
Unit: RMB
Increase/decrease
Category Beginning balance Reversed or Ending balance
Withdrawn Verified
collected
Of which, bad debt provision collected or reversed with significant amount:
□ Applicable √ Not applicable
(3) Notes Receivable Pledged by the Company at the Period-end
Unit: RMB
Item Amount pledged
Bank acceptance bill 10,800,000.00
Total 10,800,000.00
(4) Notes Receivable which Had Endorsed by the Company or had Discounted and had not Due on the
Balance Sheet Date at the Period-end
Unit: RMB
Amount of recognition termination at the Amount of not terminated recognition at
Item
period-end the period-end
Bank acceptance bill 741,319,301.45
Total 741,319,301.45
(5) Notes Transferred to Accounts Receivable because Drawer of the Notes Failed to Execute the Contract
or Agreement
Unit: RMB
105
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Amount of the notes transferred to accounts receivable at the
Item
period-end
Other notes
(6) Notes Receivable with Actual Verification for the Reporting Period
Unit: RMB
Item Amount verified
Of which, verification of significant notes receivable:
Unit: RMB
Whether occurred
Reason for because of
Name of the entity Nature Amount verified Procedure
verification related-party
transactions
Notes of the verification of notes receivable:
5. Accounts Receivable
(1) Accounts Receivable Classified by Category
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category Withdra Withdraw
Carrying Carrying
Proportio wal Proportio al
Amount Amount value Amount Amount value
n proportio n proportio
n n
Accounts receivable
for which bad debt 41,272,5 41,272,5 42,815,18 42,815,18
5.25% 1.00% 5.17% 1.00%
provision accrued 76.86 76.86 9.86 9.86
separately
Of which:
Accounts receivable
with significant
single amount for
which bad debt
provision separately
accrued
Accounts receivable
41,272,5 41,272,5 42,815,18 42,815,18
with insignificant 5.25% 100.00% 5.17% 100.00%
76.86 76.86 9.86 9.86
single amount for
106
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
which bad debt
provision separately
accrued
Accounts receivable
withdrawal of bad 744,839, 5,433,09 739,406,3 785,225,5 4,009,933 781,215,64
94.75% 0.01% 94.83% 0.01%
debt provision by 465.85 6.78 69.07 77.36 .47 3.89
group
Of which:
Accounts receivable
withdrawal of bad
744,839, 5,433,09 739,406,3 785,225,5 4,009,933 781,215,64
debt provision by 94.75% 0.73% 94.83% 0.51%
465.85 6.78 69.07 77.36 .47 3.89
credit risks
characteristics
786,112, 46,705,6 739,406,3 828,040,7 46,825,12 781,215,64
Total 100.00% 5.94% 100.00% 5.65%
042.71 73.64 69.07 67.22 3.33 3.89
Accounts receivable for which bad debt provision accrued separately: RMB0.
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion Reason for withdrawal
Accounts receivable for which bad debt provision accrued separately: RMB41,272,576.86.
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion Reason for withdrawal
Accounts receivable with
insignificant single
amount for which bad 41,272,576.86 41,272,576.86 100.00% Failed to recover
debt provision separately
accrued
Total 41,272,576.86 41,272,576.86 -- --
Accounts receivable for which bad debt provision accrued separately:
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion Reason for withdrawal
Accounts receivable withdrawal of bad debt provision by group: RMB5,433,096.78.
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion
Accounts receivable withdrawal 744,839,465.85 5,433,096.78 0.73%
107
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
of bad debt provision by credit
risks characteristics
Total 744,839,465.85 5,433,096.78 --
Notes of the basis of recognizing the group:
Withdrawal of bad debt provision by group:
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion
Notes of the basis of recognizing the group:
Please refer to the relevant information of disclosure of bad debt provision of other accounts receivable if adopting the general mode
of expected credit loss to withdraw bad debt provision of accounts receivable.
□ Applicable √ Not applicable
Disclosure by aging
Unit: RMB
Aging Ending balance
Within 1 year (including 1 year) 739,316,665.43
1-3 months 669,759,238.42
4-12 months 69,557,427.01
1 to 2 years 5,049,001.48
2 to 3 years 30,169.41
Over 3 years 443,629.53
Total 744,839,465.85
(2) Bad Debt Provision Withdrawn, Reversed or Recovered in the Reporting Period
Information of withdrawal of bad debt provision:
Unit: RMB
Changes in the Reporting Period
Category Beginning balance Ending balance
Withdrawal Reversal or recovery Write-off
Of which or bad debt provision recovered or reversed with significant amount:
Unit: RMB
Name of the entity Amount Method
(3) Particulars of the Actual Verification of Accounts Receivable during the Reporting Period
Unit: RMB
Item Amount
Of which significant actual verification of accounts receivable
108
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes of the verification of accounts receivable:
(4) Top 5 of Account Receivable of Ending Balance Collected by Arrears Party
Name of the entity Ending balance Proportion to balance of Relationship with the Time
accounts receivable (%) Company
No.1 56,415,731.35 7.63% Non-connected party Within 1 year
No.2 33,033,834.10 4.47% Non-connected party Within 1 year
No.3 32,801,732.38 4.44% Non-connected party Within 1 year
No.4 24,496,142.79 3.31% Non-connected party Within 1 year
No.5 22,155,754.41 3.00% Non-connected party Within 1 year
Total 168,903,195.03 22.84%
(5) Derecognition of Account Receivable due to the Transfer of Financial Assets
(6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of
Accounts Receivable
Other notes:
6. Accounts Receivable Financing
Unit: RMB
Item Ending balance Beginning balance
Changes in accounts receivable financing and fair value in the Reporting Period
□ Applicable √ Not applicable
Please refer to the relevant information of disclosure of bad debt provision of other accounts receivable if adopting the general mode
of expected credit loss to withdraw bad debt provision of accounts receivable financing.
□ Applicable √ Not applicable
Other notes:
7. Prepayment
(1) List by Aging Analysis
Unit: RMB
109
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Ending balance Beginning balance
Aging
Amount Proportion Amount Proportion
Within 1 year 77,522,682.89 73.78% 94,869,167.00 82.60%
1 to 2 years 7,248,502.21 6.90% 532,773.51 0.50%
2 to 3 years 19,598,562.37 18.65% 19,115,822.08 16.60%
Over 3 years 702,108.68 0.67% 337,286.50 0.30%
Total 105,071,856.15 -- 114,855,049.09 --
Notes of the reasons of the prepayment ages over 1 year with significant amount but failed settled in time:
(2) Top 5 of the Ending Balance of the Prepayment Collected according to the Prepayment Target
Name of the entity Ending amount Proportion to the balance of Time Reason
prepayments (%)
No.1 19,104,699.53 18.18% Within 1 year Did not arrived in the
settlement period
No.2 9,900,454.86 9.42% Within 1 year Did not arrived in the
settlement period
No.3 9,741,840.66 9.27% Within 1 year Did not arrived in the
settlement period
No.4 6,461,733.68 6.15% Within 1 year Did not arrived in the
settlement period
No.5 5,621,309.83 5.35% Within 1 year Did not arrived in the
settlement period
Total 50,830,038.56 48.38%
Other notes:
8. Other Receivables
Unit: RMB
Item Ending balance Beginning balance
Interest receivable 14,640,756.93 7,800,232.76
Other receivables 98,830,230.16 18,532,722.98
Total 113,470,987.09 26,332,955.74
(1) Interest Receivable
1) Category of Interest Receivable
Unit: RMB
Item Ending balance Beginning balance
110
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Fixed time deposits 14,640,756.93 7,800,232.76
Total 14,640,756.93 7,800,232.76
2) Significant Overdue Interest
Unit: RMB
Whether occurred
Entity Ending balance Overdue time Overdue reason impairment and the
judgment basis
Other notes:
3) Withdrawal of Bad Debt Provision
□ Applicable √ Not applicable
(2) Dividends Receivable
1) Category of Dividends Receivable
Unit: RMB
Item (or investees) Ending balance Beginning balance
2) Significant Dividend Receivable Aged over 1 Year
Unit: RMB
Whether occurred
Item (or investees) Ending balance Aging Reason impairment and its
judgment basis
3) Withdrawal of Bad Debt Provision
□ Applicable √ Not applicable
Other notes:
(3) Other Receivables
1) Other Receivables Classified by Category
Unit: RMB
Nature Ending carrying amount Beginning carrying amount
Margin 3,850,862.86 4,769,090.02
Pretty cash 1,032,538.11 393,469.10
Freight and miscellaneous charges on
595,996.72 384,229.74
behalf
Compensation for victim’s families on
8,928,000.00 9,760,000.00
behalf
Other intercourse funds 111,325,533.56 30,083,923.36
Total 125,732,931.25 45,390,712.22
2) Withdrawal of Bad Debt Provision
111
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Unit: RMB
First stage Second stage Third stage
Expected loss in the Expected loss in the
Bad debt provision Expected credit loss Total
duration (credit impairment duration (credit impairment
of the next 12 months
not occurred) occurred)
Balance of 1 January
111,600.51 1,376,566.24 25,369,822.49 26,857,989.24
2019
Balance of 1 January
2019 in the current —— —— —— ——
period
Withdrawal of the
-7,369.58 51,081.42 43,711.84
current period
Balance of 30 June 2019 104,230.93 1,376,566.24 25,420,903.91 26,901,701.08
Changes of carrying amount with significant amount changed of loss provision in the current period
□ Applicable √ Not applicable
Disclosure by aging
Unit: RMB
Aging Ending balance
Within 1 year (including 1 year) 104,230.93
4-12 months 104,230.93
1 to 2 years 1,113,238.70
2 to 3 years 107,993.89
Over 3 years 155,333.65
Total 1,480,797.17
3) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
Withdrawal of Bad Debt Provision:
Unit: RMB
Changes in the Reporting Period
Category Beginning balance Ending balance
Withdrawal Reversal or recovery
Withdrawal of bad debt
provision according to
26,857,989.24 43,711.84 26,901,701.08
credit risks
characteristics
Total 26,857,989.24 43,711.84 26,901,701.08
Of which bad debt provision reversed or recovered with significant amount during the Reporting Period:
Unit: RMB
Name of the entity Reversed or collected amount Method
112
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
4) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
Item Amount
Of which the verification of other receivables:
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes of verification of other receivables:
5) Top 5 of the Ending Balance of the Other Receivables Collected according to the Arrears Party
Unit: RMB
Proportion to ending
Ending balance of
Name of the entity Nature Ending balance Aging balance of other
bad debt provision
receivables (%)
No.1 Other intercourse
13,241,025.24 Over 3 years 10.53% 13,241,025.24
funds
No.2 Payment of
compensation on 8,928,000.00 2 to 3 years 7.10% 976,000.00
behalf
No.3 Other intercourse
6,000,000.00 Over 3 years 4.77% 6,000,000.00
funds
No.4 Margin 2,000,000.00 Over 3 years 1.59% 2,000,000.00
No.5 Other intercourse
1,620,621.61 Within 1 year 1.29%
funds
Total -- 31,789,646.85 -- 25.28% 22,217,025.24
6) Accounts Receivable Involving Government Subsidies
Unit: RMB
Project of government Estimated recovering
Name of the entity Ending balance Aging at period-end
subsidies time, amount and basis
7) Derecognition of Other Receivables due to the Transfer of Financial Assets
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Other Receivables
Other notes:
9. Inventory
Whether the Company has executed the new income standards
□ Yes √ No
113
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(1) Category of Inventory
Unit: RMB
Ending balance Beginning balance
Item Falling price Falling price
Carrying amount Carrying value Carrying amount Carrying value
reserves reserves
Raw materials 279,462,609.10 4,480,886.67 274,981,722.43 467,532,479.83 4,480,886.67 463,051,593.16
Goods in process 33,450,582.57 33,450,582.57 44,261,927.39 44,261,927.39
Inventory goods 497,624,371.86 21,535,814.37 476,088,557.49 536,389,667.33 21,535,814.37 514,853,852.96
Total 810,537,563.53 26,016,701.04 784,520,862.49 1,048,184,074.55 26,016,701.04 1,022,167,373.51
Whether the company need satisfy relevant disclosure requirements stated in SZSE Industrial Information Disclosure Guidance
No.4---Listed Company Specialized in Seed Industry and Planting Businesses or not?
No
(2) Falling Price Reserves of Inventory
Unit: RMB
Increase Decrease
Beginning
Item Reverse or Ending balance
balance Withdrawal Other Other
write-off
Raw materials 4,480,886.67 4,480,886.67
Inventory goods 21,535,814.37 21,535,814.37
Total 26,016,701.04 26,016,701.04
(3) Notes to the Ending Balance of Inventory Including Capitalized Borrowing Expense
(4) Completed but Unsettled Assets Generated from Construction Contacts at the Period-end
Unit: RMB
Item Amount
Other notes:
10. Contract Assets
Unit: RMB
Ending balance Beginning balance
Item Carrying Depreciation Carrying Depreciation
Carrying value Carrying value
amount reserve amount reserve
Significant changes in amount of carrying value of contract assets and reason in the Reporting Period:
114
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Unit: RMB
Item Amount changed Reason
Please refer to the relevant information of disclosure of bad debt provision of other accounts receivable if adopting the general mode
of expected credit loss to withdraw bad debt provision of contract assets.
□ Applicable √ Not applicable
Information of impairment provision withdrawn of contract assets:
Unit: RMB
Item Withdrawal Reversal Write-off Reason
Other notes:
11. Held-for-sale Assets
Unit: RMB
Ending carrying Depreciation Ending carrying Estimated Estimated
Item Fair value
amount reserve value disposal expense disposal time
Other notes:
12. Current Portion of Non-current Assets
Unit: RMB
Item Ending balance Beginning balance
Significant creditors’ investment/other creditors’ investment
Unit: RMB
Ending balance Beginning balance
Item
Par value Coupon rate Actual rate Due date Par value Coupon rate Actual rate Due date
Other notes:
13. Other Current Assets
Whether the Company has executed the new income standards
□ Yes √ No
Unit: RMB
Item Ending balance Beginning balance
The VAT deduction 23,541,987.50 19,509,101.68
Structured deposits 200,000,000.00 317,200,000.00
Prepaid expense 1,598,646.30
Advance Payment of corporate income tax 4,101.47
Total 223,541,987.50 338,311,849.45
Other notes:
115
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
14. Creditors’ Investment
Unit: RMB
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserves reserves
Significant creditors’ investment
Unit: RMB
Ending balance Beginning balance
Item
Par value Coupon rate Actual rate Due date Par value Coupon rate Actual rate Due date
Withdrawal of impairment provision
Unit: RMB
First stage Second stage Third stage
Expected loss in the Expected loss in the
Bad debt provision Expected credit loss Total
duration (credit impairment duration (credit impairment
of the next 12 months
not occurred) occurred)
Balance of 1 January
2019 in the current —— —— —— ——
period
Changes of carrying amount with significant amount changed of loss provision in the current period
□ Applicable √ Not applicable
Other notes:
15. Other Creditors’ Investment
Unit: RMB
Accumulativ
e loss
Accumulativ provision
Beginning Accrued Changes in Ending
Item Cost e changes in recognized in Notes
balance interest fair value balance
fair value other
comprehensi
ve income
Significant other creditors’ investment
Unit: RMB
Ending balance Beginning balance
Item
Par value Coupon rate Actual rate Due date Par value Coupon rate Actual rate Due date
Information of withdrawal of impairment provision
Unit: RMB
116
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
First stage Second stage Third stage
Expected loss in the Expected loss in the
Bad debt provision Expected credit loss Total
duration (credit impairment duration (credit impairment
of the next 12 months
not occurred) occurred)
Balance of 1 January
2019 in the current —— —— —— ——
period
Changes of carrying amount with significant amount changed of loss provision in the current period
□ Applicable √ Not applicable
Other notes:
16. Long-term Receivables
(1) List of Long-term Receivables
Unit: RMB
Ending balance Beginning balance
Interval of
Item Carrying Bad debt Carrying Bad debt
Carrying value Carrying value discount rate
amount provision amount provision
Withdrawal of bad debt provision
Unit: RMB
First stage Second stage Third stage
Expected loss in the Expected loss in the
Bad debt provision Expected credit loss Total
duration (credit impairment duration (credit impairment
of the next 12 months
not occurred) occurred)
Balance of 1 January
2019 in the current —— —— —— ——
period
Changes of carrying amount with significant amount changed of loss provision in the current period
□ Applicable √ Not applicable
(2) Derecognition of Long-term Receivables due to the Transfer of Financial Assets
(3) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of
Long-term Receivables
Other notes
17. Long-term Equity Investment
Unit: RMB
117
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Increase/decrease
Ending
Gains and Adjustme
Cash Withdraw balance
Additiona losses nt of
Beginnin Reduced Changes bonus or al of Ending of
Investees l recognize other
g balance investmen of other profits depreciati Other balance depreciati
investmen d under comprehe
t equity announce on on
t the equity nsive
d to issue reserves reserves
method income
I. Joint ventures
II. Associated enterprises
Guangdo
ng
Chengton 8,570,239 8,630,377
60,138.12
g .86 .98
Logistics
Co., Ltd.
China
Chengton
654,019,9 16,714,85 10,000,00 660,734,7
g Finance
18.14 2.01 0.00 70.15
Corporati
on Ltd.
662,590,1 16,774,99 10,000,00 669,365,1
Subtotal
58.00 0.13 0.00 48.13
662,590,1 16,774,99 10,000,00 669,365,1
Total
58.00 0.13 0.00 48.13
Other notes
18. Other Equity Instrument Investment
Unit: RMB
Item Ending balance Beginning balance
Non-trading equity instrument investment in the Reporting Period disclosed by category
Unit: RMB
Reason for
assigning to
Amount of other Reason for other
measure in fair
comprehensive comprehensive
Dividend income Accumulative Accumulative value of which
Item income income
recognized gains losses changes included
transferred to transferred to
other
retained earnings retained earnings
comprehensive
income
Other notes:
118
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
19. Other Non-current Financial Assets
Unit: RMB
Item Ending balance Beginning balance
Other notes:
20. Investment Property
(1) Investment Property Adopting the Cost Measurement Mode
√ Applicable □ Not applicable
Unit: RMB
Item Houses and buildings Land use right Construction in progress Total
I. Original carrying value
1. Beginning balance 46,541,207.59 46,541,207.59
2. Increased amount of
the period
(1) Outsourcing
(2)Transfer from
inventories/fixed
assets/construction in
progress
(3)Enterprise
combination increase
3. Decreased amount of
the period
(1) Disposal
(2) Other transfer
4. Ending balance 46,541,207.59 46,541,207.59
II.Accumulative
depreciation and
accumulative
amortization
1. Beginning balance 15,777,523.86 15,777,523.86
2. Increased amount of
337,709.62 337,709.62
the period
(1)Withdrawal or 337,709.62 337,709.62
119
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
amortization
3.Decreased amount of
the period
(1) Disposal
(2) Other transfer
4. Ending balance 16,115,233.48 16,115,233.48
III. Depreciation reserves
1. Beginning balance
2.Increased amount of
the period
(1) Withdrawal
3.Decreased amount of
the period
(1) Disposal
(2) Other transfer
4. Ending balance
IV. Carrying value
1. Ending carrying value 30,425,974.11 30,425,974.11
2.Beginning carrying
30,763,683.73 30,763,683.73
value
(2) Investment Property Adopting the Fair Value Measurement Mode
□ Applicable √ Not applicable
(3) Investment Property Failed to Accomplish Certification of Property
Unit: RMB
Item Carrying value Reason
Other notes
21. Fixed Assets
Unit: RMB
120
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item Ending balance Beginning balance
Fixed assets 2,111,243,885.87 2,178,817,683.33
Total 2,111,243,885.87 2,178,817,683.33
(1) List of Fixed Assets
Unit: RMB
Machinery Transportation Electronic
Houses and
Item equipment equipment and Total
buildings
others
I. Original carrying
value
1. Beginning
1,159,243,135.56 2,844,451,153.12 44,218,613.95 140,528,181.34 4,188,441,083.97
balance
2. Increased
1,298,640.21 5,604,182.07 218,534.47 816,072.06 7,937,428.81
amount of the period
(1) Purchase 1,298,640.21 2,870,133.19 218,534.47 797,623.78 5,184,931.65
(2) Transfer
from construction in 2,734,048.88 18,448.28 2,752,497.16
progress
(3) Enterprise
combination increase
3. Decreased
5,913,247.43 18,431.96 5,931,679.39
amount of the period
(1) Disposal or
1,031,008.55 18,431.96 1,049,440.51
scrap
(2) Other
4,882,238.88 4,882,238.88
transfer
4. Ending balance 1,160,541,775.77 2,844,142,087.76 44,437,148.42 141,325,821.44 4,190,446,833.39
II. Accumulative
depreciation
1. Beginning
433,291,563.14 1,356,990,789.13 38,060,452.76 104,600,838.61 1,932,943,643.64
balance
2. Increased
16,852,042.80 54,453,424.34 747,182.25 3,436,809.72 75,489,459.11
amount of the period
(1) Withdrawal 16,852,042.80 54,453,424.34 747,182.25 3,436,809.72 75,489,459.11
121
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3. Decreased
5,892,847.43 17,064.80 5,909,912.23
amount of the period
(1) Disposal or
1,010,608.55 17,064.80 1,027,673.35
scrap
(2) Other
4,882,238.88 4,882,238.88
transfer
4. Ending balance 450,143,605.94 1,405,551,366.04 38,807,635.01 108,020,583.53 2,002,523,190.52
III. Depreciation
reserves
1. Beginning
76,679,757.00 76,679,757.00
balance
2. Increased
amount of the period
(1) Withdrawal
3. Decreased
amount of the period
(1) Disposal or
scrap
4. Ending balance 76,679,757.00 76,679,757.00
IV. Carrying value
1. Ending carrying
710,398,169.83 1,361,910,964.72 5,629,513.41 33,305,237.91 2,111,243,885.87
value
2. Beginning
725,951,572.42 1,410,780,606.99 6,158,161.19 35,927,342.73 2,178,817,683.33
carrying value
(2) List of Temporarily Idle Fixed Assets
Unit: RMB
Original carrying Accumulative Depreciation
Item Carrying value Note
value depreciation reserves
(3) Fixed Assets Leased in by Financing Lease
Unit: RMB
Accumulative
Item Original carrying value Depreciation reserves Carrying value
depreciation
Houses and buildings 12,212,610.00 11,601,979.50 610,630.50
122
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Machinery equipment 3,160,000.00 3,002,000.00 158,000.00
Total 15,372,610.00 14,603,979.50 768,630.50
(4) Fixed Assets Leased out by Operation Lease
Unit: RMB
Item Ending carrying value
(5) Fixed Assets Failed to Accomplish Certification of Property
Unit: RMB
Item Carrying value Reason
Property right certificate was under
Houses and buildings 97,303,576.94
process
Total 97,303,576.94
Other notes
(6) Proceeds from Disposal of Fixed Assets
Unit: RMB
Item Ending balance Beginning balance
Other notes
22. Construction in Progress
Unit: RMB
Item Ending balance Beginning balance
Construction in progress 44,969,165.79 38,735,958.38
Total 44,969,165.79 38,735,958.38
(1) List of Construction in Progress
Unit: RMB
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserves reserves
Latex phase II
matching raw
17,619,208.37 17,619,208.37 17,151,537.73 17,151,537.73
material tank
farm project
123
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Treatment system
for industrial 3,257,781.51 3,257,781.51 1,556,896.56 1,556,896.56
waste gas
Internal and
external
antiseptic
3,072,684.86 3,072,684.86 1,943,205.00 1,943,205.00
treatment for the
120-meter
chimney
BM3 Tetra
6,429,597.43 6,429,597.43 6,338,209.24 6,338,209.24
project
Renovation
project on the
control system of 1,444,396.61 1,444,396.61 1,444,396.61 1,444,396.61
BM3 paper
machines
Advanced
waste-water
treatment and 2,477,929.63 2,477,929.63 2,477,929.63 2,477,929.63
water reuse
project
BM2 Self-made
Sizing Starch 1,978,479.72 1,978,479.72
System
Renovation
project on BM3 56,813.64 56,813.64 56,813.64 56,813.64
Broke Pulper
BM3 Reel
alternation of
hydro-acupunctur 84,168.08 84,168.08
e renovation
project
Ultra-clean
emission project 3,081,773.73 3,081,773.73
of boiler flue gas
Other 7,444,811.93 7,444,811.93 5,788,490.25 5,788,490.25
Total 44,969,165.79 44,969,165.79 38,735,958.38 38,735,958.38
(2) Changes in Significant Construction in Progress during the Reporting Period
Unit: RMB
124
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Of
Proporti
which:
on of Accumul Capitaliz
Amount
accumul ated ation rate
Transferr of
Beginnin Other ated amount of
Increase ed in Ending Job capitaliz Capital
Item Budget g decrease investme of interests
d amount fixed balance schedule ed resources
balance d amount nt in interest for the
assets interests
construct capitaliz Reportin
for the
ions to ation g Period
Reportin
budget
g Period
BM3
18,730,0 6,338,20 91,388.1 6,429,59
Tetra 34.33% 34.33% Other
00.00 9.24 9 7.43
project
Latex
phase II
matching
raw 20,000,0 17,151,5 467,670. 17,619,2
88.10% 88.10% Other
material 00.00 37.73 64 08.37
tank
farm
project
Treatme
nt
system
6,020,00 1,556,89 1,700,88 3,257,78
for 54.12% 54.12% Other
0.00 6.56 4.95 1.51
industria
l waste
gas
Internal
and
external
antisepti
c 3,500,00 1,943,20 1,129,47 3,072,68
87.79% 87.79% Other
treatmen 0.00 5.00 9.86 4.86
t for the
120-met
er
chimney
Advance
d
18,000,0 2,477,92 2,477,92
waste-w 13.77% 13.77% Other
00.00 9.63 9.63
ater
treatmen
125
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
t and
water
reuse
project
BM3
Reel
alternati
on of
hydro-ac 2,000,00 84,168.0 84,168.0
4.21% 4.21% Other
upunctur 0.00 8 8
e
renovati
on
project
Renovati
on
project
on the
control
2,000,00 1,444,39 1,444,39
system 72.22% 72.22% Other
0.00 6.61 6.61
of BM3
paper
machine
(HFJ201
7003)
BM2
Self-mad
2,900,00 1,978,47 220,713. 2,199,19
e Sizing Other
0.00 9.72 40 3.12
Starch
System
Renovati
on
project 3,500,00 56,813.6 56,813.6
1.62% 1.62% Other
on BM3 0.00 4 4
Broke
Pulper
Ultra-cle
an
emission 6,550,00 3,081,77 3,081,77
47.05% 47.05% Other
project 0.00 3.73 3.73
of boiler
flue gas
126
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
5,788,49 2,209,62 553,304. 7,444,81
Other Other
0.25 5.72 04 1.93
Other
83,200,0 38,735,9 8,985,70 2,752,49 44,969,1
Total -- -- --
00.00 58.38 4.57 7.16 65.79
(3) List of the Withdrawal of the Depreciation Reserves for Construction in Progress
Unit: RMB
Item Amount withdrawn Reason for withdrawal
Other notes
(4) Engineering Materials
Unit: RMB
Ending balance Beginning balance
Item Depreciation Carrying Depreciation
Carrying amount Carrying value Carrying value
reserves amount reserves
Other notes:
23. Productive Living Assets
(1) Productive Living Assets Adopting Cost Measurement Mode
□ Applicable √ Not applicable
(2) Productive Living Assets Adopting Fair Value Measurement Mode
□ Applicable √ Not applicable
24. Oil and Gas Assets
□ Applicable √ Not applicable
25. Right-to-use Assets
Unit: RMB
Item Total
Other notes:
127
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
26. Intangible Assets
(1) List of Intangible Assets
Unit: RMB
Item Land use right Patent right Non-patent right Software and other Total
I. Original carrying
value
1. Beginning
132,437,333.89 65,876,278.37 14,706,440.15 213,020,052.41
balance
2. Increased
542,323.53 542,323.53
amount of the period
(1) Purchase 542,323.53 542,323.53
(2) Internal
R&D
(3) Business
combination increase
3. Decreased
amount of the period
(1) Disposal
4. Ending balance 132,437,333.89 65,876,278.37 15,248,763.68 213,562,375.94
II. Accumulated
amortization
1. Beginning
51,693,548.61 24,397,676.59 5,021,566.45 81,112,791.65
balance
2. Increased
3,184,380.78 2,822,411.94 878,451.11 6,885,243.83
amount of the period
(1) Withdrawal 3,184,380.78 2,822,411.94 878,451.11 6,885,243.83
3. Decreased
amount of the period
(1) Disposal
4. Ending balance 54,877,929.39 27,220,088.53 5,900,017.56 87,998,035.48
III. Depreciation
reserves
128
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
1. Beginning
balance
2. Increased
amount of the period
(1) Withdrawal
3. Decreased
amount of the period
(1) Disposal
4. Ending balance
IV. Carrying value
1. Ending carrying
77,559,404.50 38,656,189.84 9,348,746.12 125,564,340.46
value
2. Beginning
80,743,785.28 41,478,601.78 9,684,873.70 131,907,260.76
carrying value
The proportion of intangible assets formed from the internal R&D of the Company at the Period-end to the ending balance of
intangible assets was 0.00%.
(2) Land Use Right with Certificate of Title Uncompleted
Unit: RMB
Item Carrying value Reason
Other notes:
27. R&D Expense
Unit: RMB
Beginning Ending
Item Increase Decrease
balance balance
R&D of
tobacco stem 2,799,715.49 2,799,715.49
board
R&D of
special
546,784.41 546,784.41
testing carton
base paper
Special food
4,405,940.07 4,405,940.07
packaging
129
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
board with
natural color
Total 7,752,439.97 7,752,439.97
Other notes
28. Goodwill
(1) Original Carrying Value of Goodwill
Unit: RMB
Name of the
invested units or Beginning
Increase Decrease Ending balance
events generating balance
goodwill
Zhuhai Hongta
Renheng Paper 9,129,025.01 9,129,025.01
Co., Ltd.
Zhuhai Golden
Pheasant
2,418,280.28 2,418,280.28
Chemicals Co.,
Ltd.
Total 11,547,305.29 11,547,305.29
(2) Depreciation Reserves of Goodwill
Unit: RMB
Name of the
invested units or Beginning
Increase Decrease Ending balance
events generating balance
goodwill
Zhuhai Hongta
Renheng Paper 0.00 0.00
Co., Ltd.
Zhuhai Golden
Pheasant
0.00 0.00
Chemicals Co.,
Ltd.
Information on the assets group or combination of assets groups which goodwill belongs to
Notes of the testing process of goodwill impairment, parameters (such as growth rate of the forecast period, growth rate of stable
period, rate of profit, discount rate, forecast period and so on for prediction of future present value of cash flows) and the recognition
method of goodwill impairment losses:
130
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Influence of goodwill impairment testing
Other notes
29. Long-term Prepaid Expense
Unit: RMB
Amortization Other decreased
Item Beginning balance Increased amount Ending balance
amount of the period amount
Decoration expense
168,411.39 33,130.06 135,281.33
for rent-in plant
Fee for technical
145,504.20 43,651.32 101,852.88
service
Maintaining
renovation of
4,441,590.59 799,042.74 3,642,547.85
construction
project
Total 4,755,506.18 875,824.12 3,879,682.06
Other notes
30. Deferred Income Tax Assets/Deferred Income Tax Liabilities
(1) Deferred Income Tax Assets that Had not Been Off-set
Unit: RMB
Ending balance Beginning balance
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference assets difference assets
Provision for impairment
176,170,867.67 26,425,630.18 176,170,867.67 26,425,630.18
of assets
Unrealized profit of
9,851,070.07 1,477,660.51 9,851,070.07 1,477,660.51
internal transactions
Accrued expenses 24,307,031.93 3,646,054.79 24,307,031.93 3,646,054.79
Total 210,328,969.67 31,549,345.48 210,328,969.67 31,549,345.48
(2) Deferred Income Tax Liabilities Had Not Been Off-set
Unit: RMB
Ending balance Beginning balance
Item Deductible temporary Deferred income tax Deductible temporary Deferred income tax
difference liabilities difference liabilities
131
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Assets evaluation
appreciation in the
14,212,900.20 2,131,935.03 14,212,900.20 2,131,935.03
business combination not
under the same control
Total 14,212,900.20 2,131,935.03 14,212,900.20 2,131,935.03
(3) Deferred Income Tax Assets or Liabilities Listed by Net Amount after Off-set
Unit: RMB
Mutual set-off amount of Ending balance of Mutual set-off amount of Beginning balance of
deferred income tax deferred income tax deferred income tax deferred income tax
Item
assets and liabilities at assets or liabilities after assets and liabilities at assets or liabilities after
the period-end off-set the period-begin off-set
Deferred income tax
31,549,345.48 31,549,345.48
assets
Deferred income tax
2,131,935.03 2,131,935.03
liabilities
(4) List of Unrecognized Deferred Income Tax Assets
Unit: RMB
Item Ending balance Beginning balance
Deductible losses 199,990,599.74 199,990,599.74
Provision for impairment of assets 208,702.94 208,702.94
Total 200,199,302.68 200,199,302.68
(5) Deductible Losses of Unrecognized Deferred Income Tax Assets will Due in the Following Years
Unit: RMB
Years Ending amount Beginning amount Notes
Y2019
Y2020 72,934,938.44 72,934,938.44
Y2021 1,734,170.90 1,734,170.90
Y2022 9,996,774.57 9,996,774.57
Y2023 115,324,715.83 115,324,715.83
Total 199,990,599.74 199,990,599.74 --
Other notes:
132
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
31. Other Non-current Assets
Whether the Company has executed the new income standards
□ Yes √ No
Unit: RMB
Item Ending balance Beginning balance
Prepayment of equipment 491,325.10 1,495,963.49
Total 491,325.10 1,495,963.49
Other notes:
32. Short-term Borrowings
(1) Category of Short-term Borrowings
Unit: RMB
Item Ending balance Beginning balance
Guaranteed borrowings 784,194,566.27 662,776,823.86
Credit borrowings 200,000,000.00 200,000,000.00
Trade financing 457,685,047.22
Total 1,441,879,613.49 862,776,823.86
Notes of short-term loans category:
(2) List of the Short-term Borrowings Overdue but Not Returned
The amount of the overdue unpaid short-term borrowings at the period-end was of RMB0.00, of which the significant overdue
unpaid short-term borrowings are as follows:
Unit: RMB
Borrower Ending balance Interest rate Overdue time Overdue charge rate
Other notes:
33. Trading Financial Liabilities
Unit: RMB
Item Ending balance Beginning balance
Of which:
Of which:
Other notes:
133
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
34. Derivative Financial Liabilities
Unit: RMB
Item Ending balance Beginning balance
Other notes:
35. Notes Payable
Unit: RMB
Item Ending balance Beginning balance
Bank’s acceptance bill 220,314,954.09 310,600,000.00
Total 220,314,954.09 310,600,000.00
The total amount of the due but not paid notes payable at the end of the period was of RMB0.00.
36. Accounts Payable
(2) List of Accounts Payable
Unit: RMB
Item Ending balance Beginning balance
Payment of materials 263,796,887.02 375,399,151.20
Payment of equipment 38,416,081.55 6,104,986.59
Payment of freight 26,334,754.96 42,626,350.09
Other 20,056,439.24 40,513,299.68
Total 348,604,162.77 464,643,787.56
(3) Significant Accounts Payable Aging over One Year
Unit: RMB
Item Ending balance Unpaid/ Un-carry-over reason
Other notes:
37. Advances from Customers
Whether the Company has executed the new income standards
□ Yes √ No
(1) List of Advances from Customers
Unit: RMB
134
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item Ending balance Beginning balance
Within 1 year 12,361,486.31 32,561,871.59
1-2 years 532,253.32 236,602.58
2-3 years 97,301.66 103,015.37
Over 3 years 588,102.22 530,099.25
Total 13,579,143.51 33,431,588.79
(2) Significant Advances from Customers Aging over One Year
Unit: RMB
Item Ending balance Unpaid/ Un-carry-over reason
(3) Settled but Uncompleted Projects Formed by Construction Contracts at the Period-end
Unit: RMB
Item Amount
Other notes:
38. Contract Liabilities
Unit: RMB
Item Ending balance Beginning balance
Significant changes in amount of carrying value and the reason in the Reporting Period
Unit: RMB
Item Amount changed Reason
39. Payroll Payable
(1) List of Payroll Payable
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
I. Short-term salary 41,077,842.45 78,965,775.12 94,579,750.98 25,463,866.59
II. Post-employment
benefit-defined 3,740,000.00 4,827,125.54 8,409,225.88 157,899.66
contribution plans
III. Termination benefits 457,762.90 457,762.90
Total 44,817,842.45 84,250,663.56 103,446,739.76 25,621,766.25
135
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(2) List of Short-term Salary
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
1. Salary, bonus,
30,374,026.85 69,483,127.97 84,865,658.82 14,991,496.00
allowance, subsidy
2. Employee welfare 2,990,139.04 2,990,139.04
3. Social insurance 2,962,599.78 2,962,599.78
Of which: Medical
2,484,780.42 2,484,780.42
insurance premiums
Work-re
169,137.39 169,137.39
lated injury insurance
Materni
308,681.97 308,681.97
ty insurance
4. Housing fund 33,909.36 2,301,445.01 2,267,040.21 68,314.16
5. Labor union budget
and employee education 10,669,906.24 1,228,463.32 1,494,313.13 10,404,056.43
budget
Total 41,077,842.45 78,965,775.12 94,579,750.98 25,463,866.59
(3) List of Defined Contribution Plans
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
1. Basic pension benefits 5,726,933.93 5,726,933.93
2. Unemployment
215,465.63 215,465.63
insurance
3. Annuity 3,740,000.00 -1,115,274.02 2,466,826.32 157,899.66
Total 3,740,000.00 4,827,125.54 8,409,225.88 157,899.66
Other notes:
40. Taxes Payable
Unit: RMB
Item Ending balance Beginning balance
VAT 3,768,612.68 30,384,238.41
Corporate income tax 2,754,792.66 3,347,494.70
Personal income tax 1,204,522.97 155,162.18
136
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Urban maintenance and construction tax 114,711.53 78,011.80
Education surcharge 81,936.81 55,722.70
Stamp tax 154,496.37 376,052.60
Property tax 5,038,553.68 5,085,707.04
Land use tax 1,176,365.42 1,694,485.83
Other 128,405.19 111,645.03
Total 14,422,397.31 41,288,520.29
Other notes:
41. Other Payables
Unit: RMB
Item Ending balance Beginning balance
Interest payable 3,345,720.25 6,315,962.71
Dividends payable 25,904,459.19 25,083,228.68
Other payables 73,429,443.38 148,338,686.00
Total 102,679,622.82 179,737,877.39
(1) Interest Payable
Unit: RMB
Item Ending balance Beginning balance
Interest of long-term borrowings with
installment payments of interest and 214,375.01 454,930.56
payment of principal at maturity
Interest payable of short-term borrowings 2,756,111.90 1,841,377.53
Interest payable of borrowings provided by
375,233.34 4,019,654.62
units
Total 3,345,720.25 6,315,962.71
List of the significant overdue unpaid interest:
Unit: RMB
Borrower Overdue amount Overdue reasons
Other notes:
(2) Dividends Payable
Unit: RMB
Item Ending balance Beginning balance
137
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Ordinary share dividends 25,904,459.19 25,083,228.68
Total 25,904,459.19 25,083,228.68
Other notes, including significant dividends payable unpaid for over one year, the unpaid reason shall be disclosed:
(3) Other Payables
1) Other Payables Listed by Nature
Unit: RMB
Item Ending balance Beginning balance
Pledged and margin 30,871,092.82 40,981,285.95
Prepayment 9,499,113.15 8,523,323.85
Capital of related parties 12,600,000.00 92,200,000.00
Final payment of engineering 1,373,451.97 733,688.95
Other 19,085,785.44 5,900,387.25
Total 73,429,443.38 148,338,686.00
2) Significant Other Payables Aging over One Year
Unit: RMB
Item Ending balance Unpaid/Un-carry-over reason
Other notes
42. Held-for-sale Liabilities
Unit: RMB
Item Ending balance Beginning balance
Other notes:
43. Current Portion of Non-current Liabilities
Unit: RMB
Item Ending balance Beginning balance
Current portion of long-term borrowings 200,000,000.00
Total 200,000,000.00
Other notes:
44. Other Current Liabilities
Whether the Company has executed the new income standards
□ Yes √ No
Unit: RMB
138
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item Ending balance Beginning balance
Increase/decrease of the short-term bonds payable:
Unit: RMB
Amortizat
Withdraw
ion of Repayme
The al of
Bonds Issuing Issuing Beginnin premium nt in the Ending
Par value Duration current interest
name date amount g balance and Reporting balance
issue by par
depreciati Period
value
on
Other notes:
45. Long-term Borrowings
(1) Category of Long-term Borrowings
Unit: RMB
Item Ending balance Beginning balance
Guaranteed borrowings 100,000,000.00 100,000,000.00
Total 100,000,000.00 100,000,000.00
Notes to the category of long-term borrowings:
Other notes, including the interval of interest rate:
46. Bonds Payable
(1) List of Bonds Payable
Unit: RMB
Item Ending balance Beginning balance
(2) Increase/Decrease of Bonds Payable (Excluding Other Financial Instrument Classified as Financial
Liabilities such as Preferred Shares and Perpetual Bonds)
Unit: RMB
(3) Notes to the Conditions and Time of the Shares Transfer of the Convertible Corporate Bonds
(4) Notes to Other Financial Instruments Classified as Financial Liabilities
Basic situation of other financial instruments such as preferred shares and perpetual bonds outstanding at the period-end
Changes in financial instruments such as preferred shares and perpetual bonds outstanding at the period-end
Unit: RMB
139
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Outstanding Period-beginning Increase Decrease Period-end
financial Carrying Carrying Carrying Carrying
Amount Amount Amount Amount
instrument value value value value
Notes to basis for the classification of other financial instruments as financial liabilities
Other notes
47. Lease Liabilities
Unit: RMB
Item Ending balance Beginning balance
Other notes
48. Long-term Payables
Unit: RMB
Item Ending balance Beginning balance
(1) Long-term Payables Listed by Nature
Unit: RMB
Item Ending balance Beginning balance
Other notes:
(2) Specific Payables
Unit: RMB
Reason for
Item Beginning balance Increase Decrease Ending balance
formation
Other notes:
49. Long-term Payroll Payable
(1) List of Long-term Payroll Payable
Unit: RMB
Item Ending balance Beginning balance
(2) Changes in Defined Benefit Plans
Obligation present value of defined benefit plans:
Unit: RMB
140
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item Ending balance Beginning balance
Plan assets:
Unit: RMB
Item Ending balance Beginning balance
Net liabilities (net assets) of defined benefit plans:
Unit: RMB
Item Ending balance Beginning balance
Notes of influence of content of defined benefit plans and its relevant risks to the future cash flow, time and uncertainty of the
Company:
Notes to the results of significant actuarial assumptions and sensitivity analysis of defined benefit plans:
Other notes:
50. Provision
Whether the Company has executed the new income standards
□ Yes √ No
Unit: RMB
Item Ending balance Beginning balance Reason for formation
Predicted losses resulting from
Product quality guarantee 1,508,735.64 1,508,735.64
any product quality problem
Total 1,508,735.64 1,508,735.64 --
Other notes, including notes to related significant assumptions and evaluation of significant provisions:
51. Deferred Income
Unit: RMB
Reason for
Item Beginning balance Increase Decrease Ending balance
formation
Capital
Government compensating related
30,305,313.30 2,560,534.68 27,744,778.62
subsidies funds for
construction
Total 30,305,313.30 2,560,534.68 27,744,778.62 --
Item involving government subsidies:
Unit: RMB
Amount Amount Amount
Amount of Related to
Beginning recorded into recorded into offset cost in Other Ending
Item newly assets/related
balance non-operatin other income the Reporting changes balance
subsidy to income
g income in in the Period
141
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
the Reporting Reporting
Period Period
Renovation
project of the
information
system of
Related to
paper-making 688,000.00 16,000.00 672,000.00
assets
enterprise
energy
management
center
No. 1 paper
machine
Related to
update & 214,400.00 4,800.00 209,600.00
assets
renovation
project
Liquid paper
Related to
renovation 198,333.16 17,500.02 180,833.14
assets
project
Renovation
project of the
information
Related to
system of 816,666.75 139,999.98 676,666.77
assets
energy
management
center
Steam
condensation
water Related to
1,152,000.00 192,000.00 960,000.00
recycling and assets
energy saving
projects
Subsidy of
improvement
Related to
of Zhuhai 699,397.09 349,698.62 349,698.47
assets
motor
efficiency
Subsidy of
latex phase II
Related to
production 114,000.00 114,000.00
assets
line
technological
142
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
transformatio
n
BM1 ink-jet
printer
system and
drive system
Related to
upgrade 9,584,120.15 223,753.78 9,360,366.37
assets
synthesis
technique
transformatio
n project
Zhuhai
Gaolan Port
national
treasury
equipment Related to
918,666.55 20,800.02 897,866.53
renewal assets
(Robot
Application)
special fund
subsidies
Energy
management
center
energy-savin Related to
664,066.75 113,839.98 550,226.77
g assets
technological
innovation
support fund
Post-awarded
subsidies of
Automatic Related to
4,089,155.72 89,502.84 3,999,652.88
packaging assets
line technical
innovation
Post-awarded
subsidies of
HCB-Turn
Nozzle Related to
1,681,270.73 36,417.42 1,644,853.31
optimization assets
and
technological
transformatio
143
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
n project
Post-awarded
subsidies of
TP liquid
food packing
Related to
board 4,937,748.66 4,937,748.66
assets
synthesis
technique
transformatio
n project
Post-awarded
subsidies of
MES
technical
renovation Related to
1,244,030.15 324,529.62 919,500.53
project of assets
Zhuhai
Huafeng
Paper Co.,
Ltd.
Subsidy for
migration of Related to
2,318,930.59 47,165.40 2,271,765.19
high voltage assets
cable
Specific
project
subsidy for a
new round of
technical Related to
442,727.00 -442,727.00 0.00
renovation in assets
Finance
Bureau of
Chancheng
District
2017
provincial
industrial and
information
Related to
specific funds 541,800.00 -541,800.00 0.00
assets
of Foshan
Finance
Bureau
(technical
144
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
renovation)
30,305,313.3 27,744,778.6
Total 1,576,007.68 -984,527.00
0 2
Other notes:
52. Other Non-current Liabilities
Whether the Company has executed the new income standards
□ Yes √ No
Unit: RMB
Item Ending balance Beginning balance
Other notes:
53. Share Capital
Unit: RMB
Increase/decrease (+/-)
Beginning
New shares Bonus issue Ending balance
balance Bonus shares Other Subtotal
issued from profit
The sum of
505,425,000.00 505,425,000.00
shares
Other notes:
54. Other Equity Instruments
(1) The Basic Information of Other Financial Instruments such as Preferred Stock and Perpetual Bond
Outstanding at the End of the Period
(2) Changes in Financial Instruments such as Preferred Stock and Perpetual Bond Outstanding at the End
of the Period
Unit: RMB
Outstanding Period-beginning Increase Decrease Period-end
financial Carrying Carrying Carrying Carrying
Amount Amount Amount Amount
instruments value value value value
The current changes in other equity instruments and the corresponding reasons and the basis of the relevant accounting treatment:
Other notes:
55. Capital Reserves
Unit: RMB
145
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item Beginning balance Increase Decrease Ending balance
Capital premium
256,362,525.38 256,362,525.38
(premium on stock)
Other capital reserves 459,848.04 459,848.04
Total 256,822,373.42 256,822,373.42
Other notes, including changes and reason of change:
56. Treasury Shares
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Other notes, including changes and reason of change:
57. Other Comprehensive Income
Unit: RMB
Reporting Period
Less:
Less: Recorded
Recorded in in other
other comprehe Attributabl
Income comprehensi nsive e to Attributabl
before ve income in income in Less: owners of e to
Beginning Ending
Item taxation in prior period prior Income the non-contro
balance balance
the and period and tax Company lling
Current transferred in transferred expense as the interests
Period profit or loss to retained parent after tax
in the earnings in after tax
Current the
Period Current
Period
II. Other comprehensive income
169,714.
that may subsequently be 169,714.39
39
reclassified to profit or loss
Of which: Share of other
comprehensive income of
169,714.
investees that will be reclassified 169,714.39
39
to profit or loss under equity
method
Total of other comprehensive 169,714.
169,714.39
income 39
146
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Other notes, including the adjustment of the effective gain/loss on cash flow hedges to the initial recognized amount:
58. Specific Reserve
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Other notes, including changes and reason of change:
59. Surplus Reserves
Unit: RMB
Item Beginning balance Increase Decrease Ending balance
Statutory surplus
196,399,250.80 196,399,250.80
reserves
Total 196,399,250.80 196,399,250.80
Notes, including changes and reason of change:
60. Retained Earnings
Unit: RMB
Item Reporting Period Same period of last year
Beginning balance of retained earnings before
1,012,130,481.68 1,027,794,897.70
adjustments
Total beginning balance of retained earnings
18,316.37
before adjustment (increase+, decrease-)
Beginning balance of retained earnings after
1,012,148,798.05 1,027,794,897.70
adjustments
Add: Net profit attributable to owners of the
10,489,265.80 -15,299,762.79
Company as the parent
Dividend of ordinary shares payable 12,718,781.92 22,053,834.14
Ending retained earnings 1,009,919,281.93 990,441,300.77
List of adjustment of beginning retained earnings:
(1)RMB0.00 beginning retained earnings was affected by retrospective adjustment conducted according to the Accounting Standards
for Business Enterprises and relevant new regulations.
(2) RMB0.00 beginning retained earnings was affected by changes in accounting policies.
(3) RMB0.00 beginning retained earnings was affected by correction of significant accounting errors.
(4) RMB0.00 beginning retained earnings was affected by changes in combination scope arising from same control.
(5) RMB18,316.37 beginning retained earnings was affected totally by other adjustments.
147
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
61. Operating Revenue and Cost of Sales
Unit: RMB
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main operations 1,717,953,710.89 1,529,428,697.30 1,646,488,580.95 1,500,276,960.43
Other operations 15,172,526.79 10,350,333.27 100,667,759.97 94,861,978.25
Total 1,733,126,237.68 1,539,779,030.57 1,747,156,340.92 1,595,138,938.68
Whether the Company has executed the new income standards
□ Yes √ No
Other notes:
62. Taxes and Surtaxes
Unit: RMB
Item Reporting Period Same period of last year
Urban maintenance and construction tax 1,508,336.46 2,234,486.66
Education surcharge 1,077,315.27 1,607,145.55
Property tax 5,065,418.19 4,181,949.65
Land use tax 1,176,365.41 1,155,803.20
Vehicle and vessel use tax 9,979.92 11,114.21
Stamp duty 1,143,510.07 739,190.35
Environmental tariff 115,646.96 184,939.09
Total 10,096,572.28 10,114,628.71
Other notes:
63. Selling Expense
Unit: RMB
Item Reporting Period Same period of last year
Salary and benefits 7,366,815.16 6,126,482.73
Freight and miscellaneous charges 48,262,353.07 50,297,643.49
Business entertainment fees 1,836,962.11 2,355,830.99
Warehousing fees/rental fees 5,096,953.57 4,346,575.09
Packing charges 4,504,350.08 4,844,772.59
Other 2,335,083.16 2,026,450.79
Total 69,402,517.15 69,997,755.68
148
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Other notes:
64. Administrative Expense
Unit: RMB
Item Reporting Period Same period of last year
Salary and benefits 12,615,979.27 22,682,884.61
Social insurance 2,112,371.73 9,707,779.29
Taxation 2,894.54
Depreciation 10,526,421.84 7,324,462.45
Office expenses 9,103,954.42 3,140,805.52
Business entertainment fees 1,327,451.32 890,084.10
Other 14,812,068.45 23,339,768.60
Total 50,498,247.03 67,088,679.11
Other notes:
65. R&D Expense
Unit: RMB
Item Reporting Period Same period of last year
Labor charges 4,403,748.04
Direct input expense 44,018,181.80
Depreciation and long-term amortization 3,764,946.64
Amortization of intangible assets 50,636.17
Other expanses 236,807.67
Total 52,474,320.32
Other notes:
66. Finance Costs
Unit: RMB
Item Reporting Period Same period of last year
Interest expense 36,967,366.21 46,082,510.39
Less: Interest income 8,948,675.02 1,573,895.57
Foreign exchange gains or losses 294,385.55 -1,056,338.33
Other 2,211,828.77 2,484,172.25
Total 30,524,905.51 45,936,448.74
149
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Other notes:
67. Other Income
Unit: RMB
Sources Reporting Period Same period of last year
Government subsidy related to assets 1,576,007.68 1,528,842.28
Government subsidy related to income 2,360,313.67 7,540,521.14
Total 3,936,321.35 9,069,363.42
68. Investment Income
Unit: RMB
Item Reporting Period Same period of last year
Long-term equity investment income
16,774,990.13 -88,375.92
accounted by equity method
Total 16,774,990.13 -88,375.92
Other notes:
69. Net Gains on Exposure Hedges
Unit: RMB
Item Reporting Period Same period of last year
Other notes:
70. Gain on Changes in Fair Value
Unit: RMB
Sources Reporting Period Same period of last year
Trading financial liabilities 1,340,892.01
Total 1,340,892.01
Other notes:
71. Credit Impairment Loss
Unit: RMB
Item Reporting Period Same period of last year
Other notes:
150
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
72. Assets Impairment Loss
Whether the Company has executed the new income standards
□ Yes √ No
Unit: RMB
Item Reporting Period Same period of last year
I. Bad debt loss -44,711.85 59,432.48
Total -44,711.85 59,432.48
Other notes:
73. Asset Disposal Income
Unit: RMB
Sources Reporting Period Same period of last year
Gain/loss of disposal of fixed assets -16,367.16 68,414.74
Total -16,367.16 68,414.74
74. Non-operating Income
Unit: RMB
Amount recorded in the current
Item Reporting Period Same period of last year
non-recurring profit or loss
Other 1,010,381.90 1,600,770.29 1,010,381.90
Total 1,010,381.90 1,600,770.29 1,010,381.90
Government subsidies recorded into current profit or loss
Unit: RMB
Whether
influence the Special Related to
Distribution Distribution Reporting Same period
Item Nature profits or subsidy or assets/related
entity reason Period of last year
losses of the not to income
year or not
Other notes:
75. Non-operating Expense
Unit: RMB
Amount recorded in the current
Item Reporting Period Same period of last year
non-recurring profit or loss
Other 873,583.84 930,302.34 873,583.84
151
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Total 873,583.84 930,302.34 873,583.84
Other notes:
76. Income Tax Expense
(1) List of Income Tax Expense
Unit: RMB
Item Reporting Period Same period of last year
Current income tax expense 3,245,990.34 2,962,396.75
Total 3,245,990.34 2,962,396.75
(2) Adjustment Process of Accounting Profit and Income Tax Expense
Unit: RMB
Item Reporting Period
Profit before taxation 1,137,675.35
Current income tax expense accounted at statutory/applicable tax
9,147,650.57
rate
Influence of applying different tax rates by subsidiaries -2,103,565.04
Influence of deductable temporary difference or deductable
losses of unrecognized deferred income tax in the Reporting -3,798,095.19
Period
Income tax expense 3,245,990.34
Other notes
77. Other Comprehensive Income
Refer to Note 57 for details.
78. Cash Flow Statement
(1) Cash Generated from Other Operating Activities
Unit: RMB
Item Reporting Period Same period of last year
Government subsidies 4,596,222.43 14,620,469.92
Interest income from deposits in banks 5,696,016.77 1,065,623.85
Cash pledge 2,048,398.35 4,840,265.19
Intercourse funds 2,763,480.33 51,289,766.80
152
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Insurance indemnity 418,862.33 14,495,853.54
Other 2,336,371.08 4,476,822.68
Total 17,859,351.29 90,788,801.98
Notes:
(2) Cash Used in Other Operating Activities
Unit: RMB
Item Reporting Period Same period of last year
Utilities 1,161.07 805,005.73
Repair charge 844,795.51 1,712,016.02
Transport charge 60,564.00 396,080.12
Business entertainment expenses 3,099,479.30 2,501,271.39
Rental fees 3,068,354.58 3,145,769.80
Business travel charge 2,597,471.04 1,977,241.19
Emission charges 4,680,416.02 2,864,750.05
Handling charge for banks 2,208,131.81 4,319,357.78
Premium 383,015.68 497,040.79
Charge for the agency 1,830,675.38 2,122,258.55
Intercourse funds 176,201,527.91 1,629,491.28
Correspondence 661,127.22 625,555.10
Vehicle charge 1,067,817.82 950,964.12
Other 11,863,336.49 17,379,738.87
Total 208,567,873.83 40,926,540.79
Notes:
(3) Cash Generated from Other Investing Activities
Unit: RMB
Item Reporting Period Same period of last year
Principal of structural deposits 132,200,000.00
Total 132,200,000.00
Notes:
(4) Cash Used in Other Investing Activities
Unit: RMB
153
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Item Reporting Period Same period of last year
Principal of structural deposits 15,000,000.00
Total 15,000,000.00
Notes:
(5) Cash Generated from Other Financing Activities
Unit: RMB
Item Reporting Period Same period of last year
Restricted monetary capital recovered as
33,400,956.90
margin or pledge
Total 33,400,956.90
Notes:
(6) Cash Used in Other Financing Activities
Unit: RMB
Item Reporting Period Same period of last year
Restricted monetary capital as margin or
10,501,660.17 159,238,064.51
pledge
Repayment for borrowings from external
16,000,000.00
parties
Total 26,501,660.17 159,238,064.51
Notes:
79. Supplemental Information for Cash Flow Statement
(1) Supplemental Information for Cash Flow Statement
Unit: RMB
Supplemental information Reporting Period Same period of last year
1. Reconciliation of net profit to net cash
-- --
flows generated from operating activities
Net profit -2,108,314.99 -32,962,312.07
Add: Provision for impairment of assets 44,711.85 -59,432.48
Depreciation of fixed assets, oil-gas assets,
75,489,459.11 76,391,907.37
and productive living assets
Amortization of intangible assets 6,885,243.83 6,136,945.83
Amortization of long-term prepaid expenses 875,824.12 673,351.96
154
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Losses from disposal of fixed assets,
intangible assets and other long-lived assets 16,367.16 -68,414.74
(gains: negative)
Losses from changes in fair value (gains:
-1,340,892.01
negative)
Finance costs (gains: negative) 30,524,905.51 46,082,510.39
Investment loss (gains: negative) -16,774,990.13 88,375.92
Decrease in inventories (increase: negative) 237,646,511.02 -155,609,404.15
Decrease in accounts receivable generated
-229,865,830.03 21,336,141.46
from operating activities (gains: negative)
Increase in accounts payable used in
-451,894,687.24 108,124,208.63
operating activities (decrease: negative)
Net cash generated from/used in operating
-349,160,799.79 68,792,986.11
activities
2. Significant investing and financing
activities without involvement of cash -- --
receipts and payments
3. Net increase/decrease of cash and cash
-- --
equivalent:
Ending balance of cash 206,825,557.58 194,374,798.71
Less: Beginning balance of cash 133,983,939.73 254,251,911.75
Net increase in cash and cash equivalents 72,841,617.85 -59,877,113.04
(2) Net Cash Paid For Acquisition of Subsidiaries
Unit: RMB
Amount
Of which: --
Of which: --
Of which: --
Other notes:
(3) Net Cash Received from Disposal of the Subsidiaries
Unit: RMB
Amount
Of which: --
Of which: --
155
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Of which: --
Other notes:
(4) Cash and Cash Equivalents
Unit: RMB
Item Ending balance Beginning balance
I. Cash 206,825,557.58 133,983,939.73
Including: Cash on hand 223,619.39 131,195.64
Bank deposit on demand 206,601,938.19 127,881,489.59
III. Ending balance of cash and cash
206,825,557.58 133,983,939.73
equivalents
Other notes:
80. Notes to Items of the Statements of Changes in Owners’ Equity
Notes to the name of “Other” of ending balance of the same period of last year adjusted and the amount adjusted:
81. Assets with Restricted Ownership or Right to Use
Unit: RMB
Item Ending carrying value Reason for restriction
Monetary capital 10,501,660.17 Cash deposit
Other current assets 200,000,000.00 Pledge guarantee
Total 210,501,660.17 --
Other notes:
82. Foreign Currency Monetary Items
(1) Foreign Currency Monetary Items
Unit: RMB
Ending foreign currency Ending balance converted to
Item Exchange rate
balance RMB
Monetary capital -- --
Of which: USD 8,501,166.58 6.87 58,442,969.86
EUR
HKD 79,726.00 0.88 70,131.78
GBP
156
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Accounts receivable -- --
Of which: USD 8,525,836.24 6.87 58,612,562.54
EUR
HKD 2,982,178.46 0.88 2,623,303.10
Long-term borrowings -- --
Of which: USD
EUR
HKD
Short-term borrowings --
Of which: USD 27,038,214.54 6.87 185,879,613.49
Accounts payable --
Of which: USD 12,939,644.24 6.87 88,956,172.26
EUR 304,902.00 7.82 2,383,418.94
Other receivables --
Of which: HKD 15,052,435.31 0.88 13,241,025.24
Other notes:
(2) Notes to Overseas Entities Including: for Significant Oversea Entities, Main Operating Place, Recording
Currency and Selection Basis Shall Be Disclosed; if there Are Changes in Recording Currency, Relevant
Reasons Shall Be Disclosed.
□ Applicable √ Not applicable
83. Arbitrage
Qualitative and quantitative information of relevant arbitrage instruments, hedged risk in line with the type of arbitrage to disclose:
84. Government Subsidy
(1) Basic Information on Government Subsidy
Unit: RMB
Amount recorded in the current
Category Amount Listed items
profit or loss
Government subsidy related to
1,576,007.68 Other income 1,576,007.68
assets
Government subsidy, related to
2,360,313.67 Other income 2,360,313.67
income, and used to compensate
157
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
accrual cost expense or losses
of the Company
Total 3,936,321.35 3,936,321.35
(2) Return of Government Subsidy
□ Applicable √ Not applicable
Other notes:
85. Other
VIII. Changes of Consolidation Scope
1. Business Combination Not under the Same Control
(1) Business Combination Not under the Same Control during the Reporting Period
Unit: RMB
Income of Net profits of
Time and
Cost of Recognition acquiree from acquiree from
Name of place of Proportion of Way to gain
gaining the Purchase date basis of the purchase the purchase
acquiree gaining the equity the equity
equity purchase date date to date to
equity
period-end period-end
Other notes:
(2) Combination Cost and Goodwill
Unit: RMB
Combination cost
Note to determination method of the fair value of the combination cost, consideration and changes:
The main formation reason for the large goodwill:
Other notes:
(3) The Identifiable Assets and Liabilities of Acquiree on Purchase Date
Unit: RMB
Fair value on purchase date Carrying value on purchase date
The determination method of the fair value of identifiable assets and liabilities
Contingent liability of acquiree undertaken in the business combination
Other notes:
158
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(4) Gains or losses from Re-measurement of Equity Held before the Purchase Date at Fair Value
Whether there is a transaction that through multiple transaction step by step to realize business combination and gaining the control
during the Reporting Period
□ Yes √ No
(5) Notes to Reasonable Consideration or Fair Value of Identifiable Assets and Liabilities of the Acquiree
that Cannot Be Determined on the Acquisition Date or during the Period-end of the Merger
(6) Other Notes
2. Business Combination under the Same Control
(1) Business Combination under the Same Control during the Reporting Period
Unit: RMB
Income from Net profits
the from the Income of the Net profits of
Recognition
period-begin period-begin acquiree the acquiree
Combined Proportion of Combination basis of
Basis ning to the ning to the during the during the
party the equity date combination
combination combination period of period of
date
date of the date of the comparison comparison
acquiree acquiree
Other notes:
(2) Combination Cost
Unit: RMB
Combination cost
Note to contingent consideration and the changes:
Other notes:
(3) The Carrying Value of Assets and Liabilities of the Combined Party on the Combination Date
Unit: RMB
Combination date Period-end of the last period
Contingent liabilities of the combined party undertaken in the business combination
Other notes:
159
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3. Counter Purchase
Basic information of trading, the basis of transactions constitute counter purchase, the retain assets , liabilities of the listed companies
whether constituted a business and its basis, the determination of the combination costs, the amount and calculation of adjusted rights
and interests in accordance with the equity transaction process:
4. Disposal of Subsidiary
Whether there is a single disposal of the investment to the subsidiary and lost control?
□ Yes √ No
Whether there are several disposals of the investment to the subsidiary and lost controls?
□ Yes √ No
5. Changes in Combination Scope for Other Reasons
Note to changes in combination scope for other reasons (such as newly establishment or liquidation of subsidiaries, etc.) and relevant
information:
6. Other
IX. Equity in Other Entities
1. Equity in Subsidiary
(1) Subsidiaries
Main operating Nature of Holding percentage (%)
Name Registration place Way of gaining
place business Directly Indirectly
Business
Zhuhai Hongta
Manufacturing combination not
Renheng Paper Zhuhai Zhuhai 41.97%
industry under the same
Co., Ltd.
control
Business
Zhuhai Huafeng Manufacturing combination
Zhuhai Zhuhai 100.00%
Paper Co., Ltd. industry under the same
control
Zhuhai Golden Business
Pheasant Manufacturing combination not
Zhuhai Zhuhai 51.00%
Chemical Co., industry under the same
Ltd. control
Huaxin (Foshan) Manufacturing
Foshan Foshan 100.00% Establishment
Color Printing industry
160
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Co., Ltd.
Zhejiang Hongta
Renheng
Manufacturing
Packaging Pinghu Pinghu 100.00% Establishment
industry
Technology Co.,
Ltd.
Notes: Holding proportion in subsidiary different from voting proportion:
Basis of holding half or less voting rights but still controlling the investee and holding more than half of the voting rights but not
controlling the investee:
The Company holds 41.9653% shares of Hongta Renheng, and in accordance with the contract and articles, there
is seven directors in Hongta Renheng, of which four directors are sent by the Company, two sent by Yunnan
Hongta Group Co., Ltd. (now renamed to Yunnan Hehe (Group) Co., Ltd.) and one sent by Renheng Industrial Co.,
Ltd. Dragon State International Limited didn’t send any director. The Company still controls Hongta Renheng,
and will continue to include it into the consolidated financial statements of the Company in this year.
Significant structural entities and controlling basis in the scope of combination:
Basis of determining whether the Company is the agent or the principal:
Other Notes:
(2) Significant Non-wholly-owned Subsidiary
Unit: RMB
Shareholding proportion The profit or loss Declaring dividends Balance of
Name of non-controlling attributable to the distributed to non-controlling interests
interests non-controlling interests non-controlling interests at the period-end
Zhuhai Hongta Renheng
58.03% 5,191,848.48 100,455,717.63
Packaging Co., Ltd.
Holding proportion of non-controlling interests in subsidiary different from voting proportion:
Other notes:
(3) The Main Financial Information of Significant Not Wholly-owned Subsidiary
Unit: RMB
Ending balance Beginning balance
Non-curr Non-curr Non-curr Non-curr
Name Current Total Current Total Current Total Current Total
ent ent ent ent
assets assets liabilities liabilities assets assets liabilities liabilities
assets liability assets liability
Zhuhai 2,626,49 2,190,40 4,816,90 2,033,19 152,753, 2,185,95 2,583,10 2,250,50 4,833,61 2,010,15 154,329, 2,164,48
Hongta 5,762.96 5,363.01 1,125.97 7,535.96 788.22 1,324.18 4,910.22 5,869.29 0,779.51 1,157.60 795.90 0,953.50
161
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Renheng
Packagin
g Co.,
Ltd.
Unit: RMB
Reporting Period Same period of last year
Cash flows Cash flows
Total Total
Name Operating from Operating from
Net profit comprehensi Net profit comprehensi
revenue operating revenue operating
ve income ve income
activities activities
Zhuhai
Hongta
1,580,350,48 -25,461,242.3 -25,461,242.3 -346,508,511. 1,598,489,61 -35,995,509.2 -35,995,509.2 69,214,338.0
Renheng
1.08 0 0 07 3.06 3 3 1
Packaging
Co., Ltd.
Other notes:
(4) Significant Restrictions on Using the Assets and Liquidating the Liabilities of the Company
(5) Financial Support or Other Supports Provided to Structural Entities Incorporated into the Scope of
Consolidated Financial Statements
Other notes:
2. The Transaction of the Company with Its Owner’s Equity Share Changed but Still Controlling the
Subsidiary
(1) Note to the Owner’s Equity Share Changed in Subsidiary
(2) The Transaction’s Influence on the Equity of Non-controlling Interests and the Owner's Equity
Attributable to the Company as the Parent
Unit: RMB
Other notes
3. Equity in Joint Ventures or Associated Enterprises
(1) Significant Joint Ventures or Associated Enterprises
Main operating Nature of Holding percentage (%) Accounting
Name Registration place
place business Directly Indirectly treatment of the
162
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
investment to
joint venture or
associated
enterprise
China Chengtong
Accounted by
Finance Beijing Beijing Financial industry 10.00%
equity method
Corporation Ltd.
Notes to holding proportion of joint venture or associated enterprise different from voting proportion:
Basis of holding less than 20% of the voting rights but has a significant impact or holding 20% or more voting rights but does not
have a significant impact:
During the Reporting Period, the voting proportion in China Chengtong Finance Corporation Ltd. enjoyed by the
Company is less than 20%. Since the Company has sent directors to participate in its operation and
decision-making, the Company still has significant influence on it.
(2) Main Financial Information of Significant Joint Ventures
Unit: RMB
Beginning balance/The same period of last
Ending balance/Reporting Period
year
Other notes
(3) Main Financial Information of Significant Associated Enterprise
Unit: RMB
Beginning balance/The same period of last
Ending balance/Reporting Period
year
China Chengtong Finance Corporation China Chengtong Finance Corporation
Ltd. Ltd.
Current assets 5,947,648,525.75 25,574,032,061.34
Non-current assets 15,663,023,415.63 9,676,334,033.81
Total assets 21,610,671,941.38 35,250,366,095.15
Current liabilities 15,003,324,239.84 28,710,166,913.77
Total liabilities 15,003,324,239.84 28,710,166,913.77
Operating revenue 274,100,890.45 255,118,244.89
Net profit 167,148,315.55 134,240,021.09
Total comprehensive income 167,148,315.55 134,240,021.09
Dividend received from associated
10,000,000.00
enterprises in the current year
163
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Other notes
(4) Summary Financial Information of Insignificant Joint Ventures or Associated Enterprise
Unit: RMB
Beginning balance/The same period of last
Ending balance/Reporting Period
year
Joint ventures: -- --
The total of following items according to the
-- --
shareholding proportions
Associated enterprises: -- --
Total carrying value of investment 8,630,377.98 8,570,239.86
The total of following items according to the
-- --
shareholding proportions
--Net profit 187,931.62 235,720.79
--Total comprehensive income 187,931.62 235,720.79
Other notes
(5) Note to the Significant Restrictions on the Ability of Joint Ventures or Associated Enterprises to
Transfer Funds to the Company
(6) The Excess Loss of Joint Ventures or Associated Enterprises
Unit: RMB
The cumulative recognized The derecognized losses (or the
The accumulative unrecognized
Name losses in previous share of net profit) in Reporting
losses in Reporting Period
accumulatively derecognized Period
Other notes
(7) The Unrecognized Commitment Related to Investment to Joint Ventures
(8) Contingent Liabilities Related to Investment to Joint Ventures or Associated Enterprises
4. Significant Common Operation
Proportion /share portion
Name Main operating place Registration place Nature of business
Directly Indirectly
Notes to holding proportion or share portion in common operation different from voting proportion:
For common operation as a single entity, basis of classifying as common operation
Other notes
164
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
5. Equity in the Structured Entity Excluded in the Scope of Consolidated Financial Statements
Notes to the structured entity excluded in the scope of consolidated financial statements:
6. Other
X. The Risk Related to Financial Instruments
The Company is engaged in risk management to achieve balance between risks and returns, minimizing the
negative effects of risks on its operation performance and maximizing the interests of its shareholders and other
equity investors. Based on that risk management goal, the fundamental strategy of its risk management is to
identify and analyze various risks facing the Company, establish an appropriate risk bottom line, carry out risk
management and monitor various risks in a timely and reliable manner to control them within a restricted scope.
The Company faces various risks related to financial instruments in its routine activities, mainly including credit
risk, liquidity risk market risk. The management has reviewed and approved the policies of managing those risks,
which are summarized as follows.
(I) Credit Risk
Credit risk means the risk of financial losses incurred to the other party when one party of a financial instrument is
unable to fulfill its obligations.
The Company’s credit risk mainly comes from bank deposits and accounts receivable. To control the
aforementioned relevant risks, the Company has adopted the following measures.
1. Bank deposits
The Company places its bank deposits with financial institutions of high credit ratings. Thus, its credit risk is low.
2. Accounts receivable
The Company conducts credit assessment on the customers trading in the mode of credit on a regular basis. Based
on the credit assessment result, the Company chooses to trade with recognized customers with good credit and
monitor the balance of the accounts receivable from them to ensure that the Company will not face any significant
bad debt risk.
(II) Liquidity Risk
Liquidity risk refers to the risk of fund shortage occurring when the Company fulfills the settlement obligation in
the mode of cash delivery or other financial assets. Liquidity risk may originate from the failure to sell financial
assets at fair value as soon as possible; or from the other party’s failure to pay off its contractual debts; or from the
earlier maturity of debts; or from the failure to generate the expected cash flow.
To control the risk, the Company comprehensively adopts multiple financing approaches including notes clearing
and bank loans, appropriately combine long-term and short-term financing modes and optimize the financing
structure to maintain the balance between financing sustainability and flexibility. The Company has obtained the
line of credit from a number of commercial banks to satisfy its operation fund needs and capital expenditure.
(III) Market Risk
Market risk means the fluctuation risk of the fair value of financial instruments or the future cash flow due to
market price changes.
1. Interest rate risk
Interest rate risk means the fluctuation risk of the fair value of financial instruments or the future cash flow due to
changes of market interest rate. The risk of changes of market interest rate facing the Company is mainly related
to its borrowings with interests calculated in floating interest rates.
165
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2. Foreign exchange risk
XI. The Disclosure of Fair Value
1. Ending Fair Value of Assets and Liabilities at Fair Value
Unit: RMB
Ending fair value
Item Fair value measurement Fair value measurement Fair value measurement
Total
items at level 1 items at level 2 items at level 3
I. Consistent fair value
-- -- -- --
measurement
II. Inconsistent fair value
-- -- -- --
measurement
2. Market Price Recognition Basis for Consistent and Inconsistent Fair Value Measurement Items at Level
1
3. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for
Consistent and Inconsistent Fair Value Measurement Items at Level 2
4. Valuation Technique Adopted and Nature and Amount Determination of Important Parameters for
Consistent and Inconsistent Fair Value Measurement Items at Level 3
5. Sensitiveness Analysis on Unobservable Parameters and Adjustment Information between Beginning and
Ending Carrying Value of Consistent Fair Value Measurement Items at Level 3
6. Explain the Reason for Conversion and the Governing Policy when the Conversion Happens if
Conversion Happens among Consistent Fair Value Measurement Items at Different Levels
7. Changes in the Valuation Technique in the Current Period and the Reason for Such Changes
8. Fair Value of Financial Assets and Liabilities Not Measured at Fair Value
9. Other
XII. Related Party and Related-party Transactions
1. Information Related to the Company as the Parent of the Company
Proportion of share Proportion of voting
Name Registration place Nature of business Registered capital
held by the rights owned by the
166
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Company as the Company as the
parent against the parent against the
Company (%) Company (%)
Foshan Huaxin
Manufacturing
Development Co., Foshan RMB457.93 million 65.20% 65.20%
industry
Ltd.
Notes: Information on the Company as the parent
China National Paper-industry Investment Corporation, the actual controller of the Company, directly holds 0.11% shares of the
Company. The total shares of the Company directly held by China National Paper-industry Investment Corporation and indirectly
held through Foshan Huaxin Development Co., Ltd. are 65.31%. China Chengtong Holdings Group Co., Ltd., the ultimate controller
of the Company, enjoys all shares of China National Paper-industry Investment Corporation.
The ultimate controller of the Company is China Chengtong Holdings Group Co., Ltd.
Other notes:
2. Subsidiaries of the Company
Refer to Note IX Equity in Other Entities for details.
3. Information on the Joint Ventures and Associated Enterprises of the Company
Refer to Note IX Equity in Other Entities for details of significant joint ventures or associated enterprises of the Company.
Information on other joint venture or associated enterprise of occurring related-party transactions with the Company in Reporting
Period, or forming balance due to related-party transactions made in previous period:
Name Relationship with the Company
Guangdong Chengtong Logistics Co., Ltd. Associated enterprise
Other notes
4. Information on Other Related Parties
Name Relationship with the Company
Foshan Huaxin Import & Export Co., Ltd. Under the control of the same actual controller
Guangdong Guanhao High-tech Co., Ltd. Under the control of the same actual controller
Dragon State International Limited Under the control of the same ultimate controller
Tianjin Port Free Trade Zone Zhongwu Investment Development
Under the control of the same actual controller
Co., Ltd.
Yueyang Forest & Paper Co., Ltd. Under the control of the same actual controller
Yueyang Antai industrial Co., Ltd Under the control of the same actual controller
Yuanjiang Paper Co., Ltd. Under the control of the same actual controller
Hunan Juntai Pulp Paper Co., Ltd. Under the control of the same actual controller
167
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Zhejiang Guanhao Advanced Materials Co., Ltd. Under the control of the same actual controller
Guangdong Guanhao High-tech Industrial Co., Ltd. Under the control of the same ultimate controller
Dragon State Investment Development Co., Ltd. Under the control of the same ultimate controller
China Chengtong International Co., Ltd. Under the control of the same ultimate controller
HONG KONG DRAGON STATE YAN WING
Under the control of the same ultimate controller
INTERNATIONAL COMPANY
Zhanjiang Guanhao Paper Co., Ltd. Under the control of the same ultimate controller
Chengtong Energy (Guangdong) Co., Ltd. Under the control of the same ultimate controller
Tianjin CMST Chuangshi Logistics Co., Ltd. Under the control of the same ultimate controller
Other notes
5. List of Related-party Transactions
(1) Information on Acquisition of Goods and Reception of Labor Service
Information on acquisition of goods and reception of labor service
Unit: RMB
The approval trade Whether exceed trade Same period of last
Related party Content Reporting Period
credit credit or not year
China National
Purchase of raw
Paper Industry 126,507,408.64 700,000,000.00 No 214,094,722.75
material
Investment Corp.
Yueyang Antai Purchase of raw
No 692,400.00
Industrial Co., Ltd. material
Yueyang Forest & Purchase of raw
177,773.88 2,000,000.00 No 171,715.38
Paper Co., Ltd. material
Guangdong
Purchase of raw
Guanhao High-tech 5,000,000.00 No 140,188.95
material
Industrial Co., Ltd.
Zhejiang Guanhao
Purchase of raw
Advanced Materials 177,467.34 No 24,783.31
material
Co., Ltd.
Guangdong
Providing logistics
Chengtong No 2,049,320.03
service
Logistics Co., Ltd.
Tianjin CMST
Providing logistics
Chuangshi Logistics 25,831,228.51 81,000,000.00 No 13,872,403.69
service
Co., Ltd.
Total 152,693,878.37 788,000,000.00 231,045,534.11
168
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Information of sales of goods and provision of labor service
Unit: RMB
Related party Content Reporting Period Same period of last year
China National Paper Industry
Sales of raw material 760,598.86
Investment Corp.
Yueyang Forest & Paper Co.,
Sales of products 9,773,533.31 8,187,800.99
Ltd.
Guangdong Guanhao High-tech Sales of products and raw
3,913,339.14 6,929,987.67
Co., Ltd. materials
Zhanjiang Guanhao Paper Co.,
Sales of products 174,670.48
Ltd.
Total 13,686,872.45 16,053,058.00
Information of sales/purchase of goods and provision/reception of labor service
(2) Information on Related-party Trusteeship/Contract
Lists of trusteeship/contract:
Unit: RMB
Name of the Name of the Income
entruster/contract entrustee/ Type Start date Due date Pricing basis recognized in this
ee contractor Reporting Period
Notes:
Lists of entrust/contractee
Unit: RMB
Name of the Name of the Charge
entruster/contract entrustee/ Type Start date Due date Pricing basis recognized in this
ee contractor Reporting Period
Notes:
(3) Information on Related-party Lease
The Company was lessor:
Unit: RMB
The lease income confirmed in The lease income confirmed in
Name of lessee Category of leased assets
the Reporting Period the same period of last year
The Company was lessee:
Unit: RMB
The lease fee confirmed in the The lease fee confirmed in the
Name of lessor Category of leased assets
Reporting Period same period of last year
169
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Notes:
(4) Information on Related-party Guarantee
The Company was guarantor
Unit: RMB
Execution accomplished
Secured party Guarantee amount Start date End date
or not
The Company was secured party
Unit: RMB
Execution accomplished
Guarantor: Guarantee amount Start date End date
or not
Notes:
(5) Information on Inter-bank Lending of Capital of Related Parties
Unit: RMB
Related party Amount Start date End date Note
Borrowing
Lending
(6) Information on Assets Transfer and Debt Restructuring by Related Party
Unit: RMB
Related party Content Reporting period Same period of last year
(7) Information on Remuneration for Key Management Personnel
Unit: RMB
Item Reporting period Same period of last year
(8) Other Related-party Transactions
6. Accounts Receivable and Payable of Related Party
(1) Accounts Receivable
Unit: RMB
Ending balance Beginning balance
Item Related party
Carrying amount Bad debt provision Carrying amount Bad debt provision
170
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Foshan Huaxin
Accounts receivable Import & Export 549,882.60 330,982.23 549,882.60 330,982.23
Co., Ltd.
Guangdong Guanhao
Accounts receivable 2,686,920.39 3,344,313.88
High-tech Co., Ltd.
Yueyang Forest &
Accounts receivable 1,375,581.99 3,906,883.44
Paper Co., Ltd.
Yueyang Antai
Accounts receivable 5,302.10 5,302.10 5,302.10 5,302.10
Industrial Co., Ltd
Zhanjiang Guanhao
Accounts receivable 2,617.76 130.89 2,617.76 130.89
Paper Co., Ltd.
Dragon State
Investment
Accounts receivable 171.58 171.58 175.15 175.15
Development Co.,
Ltd.
China Paper
Accounts receivable 947,062.75
Corporation
Subtotal 5,567,539.17 336,586.80 10,415,737.43 336,590.37
China Paper
Prepayments 47,438.00
Corporation
Guangdong
Prepayments Chengtong Logistics 558,233.03
Co., Ltd.
Tianjin CMST
Prepayments Chuangshi Logistics 3,000,000.00
Co., Ltd.
Subtotal 3,047,438.00 558,233.03
Guangdong
Other accounts
Chengtong Logistics 515,666.66 899,858.00 50,250.77
receivable
Co., Ltd.
Subtotal 515,666.66 899,858.00 50,250.77
(2) Accounts Payable
Unit: RMB
Item Related party Ending carrying amount Beginning carrying amount
Guangdong Chengtong
Accounts payable 510,997.88 510,997.88
Logistics Co., Ltd.
Accounts payable China Paper Corporation 15,470,083.49 112,621,632.26
171
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Yueyang Antai Industrial Co.,
Accounts payable 229,398.00
Ltd
Zhejiang Guanhao Advanced
Accounts payable 90,884.16 118,390.00
Materials Co., Ltd.
Tianjin CMST Chuangshi
Accounts payable 14,280,156.81 33,071,832.47
Logistics Co., Ltd.
Guangdong Guanhao High-tech
Accounts payable 184,200.17
Industrial Co., Ltd.
Yueyang Forest & Paper Co.,
Accounts payable 98,600.00
Ltd.
Subtotal 30,634,922.51 148,278,944.31
Advances from customers China Paper Corporation 1,147,031.58
Subtotal 1,242,021.55
Foshan Huaxin Development
Other accounts payable 12,600,000.00 13,007,084.99
Co., Ltd.
Guangdong Chengtong
Other accounts payable 225,255.08 1,110,384.98
Logistics Co., Ltd.
Tianjin CMST Chuangshi
Other accounts payable 18,800,000.00 16,400,000.00
Logistics Co., Ltd.
Other accounts payable China Paper Corporation 81,634,166.67
Subtotal 31,625,255.08 112,151,636.64
7. Commitments of Related Party
8. Other
XIII. Stock Payment
1. The Overall Situation of Stock Payment
□ Applicable □ Not applicable
2. The Stock Payment Settled in Equity
□ Applicable □ Not applicable
3. The Stock Payment Settled in Cash
□ Applicable □ Not applicable
172
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
4. Modification and Termination of the Stock Payment
Naught
5. Other
XIV. Commitments and Contingency
1. Significant Commitments
Significant Contingency on Balance Sheet Date
As of 30 June 2019, there was no significant commitment for the Company to disclose.
2. Contingency
(1) Significant Contingency on Balance Sheet Date
Contingency generated from pending action or arbitration and the corresponding financial influence
On 4 March 2017, Jiangsu Tianxing High-Altitude Anti-Corrosion Engineering Co., Ltd. (hereinafter referred to
as “Jiangsu Tianxing”) and Wuhan Kedio Electric Power Technology Co., Ltd. (hereinafter referred to as “Wuhan
Kedio”) undertook the 120m reinforced concrete chimney anti-corrosion project for Zhuhai Huafeng Paper Co.,
Ltd., a subsidiary of the Company, flash burn caused high-altitude falling of serious industrial accident, resulting
in the death of six workers. On 7 March 2017, Zhuhai Huafeng compensated the relatives of the victims with
RMB11.16 million under the government requirements and its supervision on behalf of Jiangsu Tianxing and
Wuhan Kedio in advance. On 14 March 2017, Zhuhai Huafeng applied to property attachment prior to lawsuit to
People’s Court of Zhuhai Jinwan District., and brought a lawsuit of recourse against Jiangsu Tianxing
High-Altitude Anti-Corrosion Engineering Co., Ltd. and Wuhan Kedio Electric Power Technology Co., Ltd. in
People’s Court of Zhuhai Jinwan on 16 March 2017. Then, Wuhan Kedio applied to add Yancheng Xinda
High-Altitude Anti-Corrosion Co., Ltd. (hereinafter referred to as “Xinda Company”) as a defendant and Xinda
Company applied to add Liu Jiechun as a defendant. The lawsuit was the case of dispute over rights of recourse in
the subsidiary of the Company.
As of the period-end, the civil compensation case has been made a final judgment, and now has entered the
implementation phase. Zhuhai Huafeng and other four defendants should take one fifth of responsibility
respectively, namely to afford the compensation of RMB2.232 million respectively. At present Zhuhai Huafeng
has received the compensation from defendants of RMB2.23 million, and RMB6.7 million is remained to be paid
off.
(2) In Despite of no Significant Contingency to Disclose, the Company Shall Also Make Relevant
Statements
There was no significant contingency in the Company.
173
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3. Other
XV. Events after Balance Sheet Date
1. Significant Non-adjusted Events
Unit: RMB
Influence number to the
Reason of inability to estimate
Item Content financial position and operating
influence number
results
2. Profit Distribution
Unit: RMB
3. Sales Return
4. Notes to Other Events after Balance Sheet Date
XVI. Other Significant Events
1. The Accounting Errors Correction in Previous Period
(1) Retrospective Restatement
Unit: RMB
Name of the influenced report
Content Processing program Accumulative impact
items during comparison period
(2) Prospective Application
Reason for adopting prospective
Content Processing program
application
174
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
2. Debt Restructuring
3. Assets Replacement
(1) Non-monetary Assets Exchange
(2) Other Assets Replacement
4. Pension Plan
Approved in the 9th meeting of the 6th of Board of Directors in 2016, the Company could participate in the
corporate pension plan of China Chengtong Holdings Co., Ltd., and formulate its own pension plan
implementation rules under the framework of China Chengtong Holdings Co., Ltd. in line with China National
Paper Industry Investment Corp. Pension Plan Implementation Rules and the actual situation. Annuity payment is
divided into enterprise contribution and individual contribution. The total annual contribution of the enterprise is
5% of the total salary of the previous year, the individual contribution of the employee is 25% of the contribution
of the enterprise, and the employee who is in service before 1 January 2017 of the Company can volunteer to
participation in the annuity plan.
5. Discontinued Operations
Unit: RMB
Profit from
discontinued
operations
Income tax
Item Income Expense Total profit Net profit attributable to
expense
owners of the
Company as the
parent
Other notes
6. Segment Information
(1) Determination Basis and Accounting Policies of Reportable Segment
In accordance with the internal organization structure, management requirements and internal report system, the
Company identified the reportable segments based on the product segment and assessed the operational
performance of ivory business, printing business and latex business. The assets and liabilities sharing with other
segments shall be proportionally distributed among segments by scales.
175
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(2) The Financial Information of Reportable Segment
Unit: RMB
Chemical Offset among
Item Ivory board Printed matter Other Total
industry segment
Main business
1,435,788,258.29 153,281,169.20 181,385,775.44 -52,501,492.04 1,717,953,710.89
revenue
Main business
1,317,141,056.79 115,920,852.74 148,868,279.81 -52,501,492.04 1,529,428,697.30
cost
-1,270,538,843.8
Total assets 4,610,249,541.80 386,556,677.83 310,015,897.87 1,770,847,375.15 5,807,130,648.83
2
Total liabilities 2,089,487,715.97 150,438,122.68 145,351,206.01 12,982,331.67 -99,772,266.80 2,298,487,109.53
(3) If there Was no Reportable Segment, or the Total Amount of Assets and Liabilities of Each Reportable
Segment Could not Be Reported, Relevant Reasons Shall Be Clearly Stated
(4) Other Notes
7. Other Significant Transactions and Events with Influence on Investors’ Decision-making
8. Other
XVII. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Accounts Receivable
(1) Accounts Receivable Disclosed by Category
Unit: RMB
Ending balance Beginning balance
Carrying amount Bad debt provision Carrying amount Bad debt provision
Category Withdra Withdraw
Carrying Carrying
Proportio wal Proportio al
Amount Amount value Amount Amount value
n proportio n proportio
n n
Of which:
Of which:
Individual withdrawal of bad debt provision:
Unit: RMB
Name Ending balance
176
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Carrying amount Bad debt provision Withdrawal proportion Reason for withdrawal
Withdrawal of bad debt provision by group:
Unit: RMB
Ending balance
Name
Carrying amount Bad debt provision Withdrawal proportion
Notes of the basis of recognizing the group:
Please refer to the relevant information of disclosure of bad debt provision of other accounts receivable if adopting the general mode
of expected credit loss to withdraw bad debt provision of accounts receivable.
□ Applicable √ Not applicable
Disclosure by aging
Unit: RMB
Aging Ending balance
Total 0.00
(2) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
Information of withdrawal of bad debt provision:
Unit: RMB
Changes in the Reporting Period
Category Beginning balance Ending balance
Withdrawal Reversal or recovery Write-off
Significant amount of reversed or recovered bad debt provision:
Unit: RMB
Name of the entity Reversed or collected amount Method
(3) Particulars of the Actual Verification of Accounts Receivable during the Reporting Period
Unit: RMB
Item Amount
Of which the verification of significant accounts receivable:
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes to the verification of accounts receivable:
177
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
(4) Top 5 of the Ending Balance of Accounts Receivable Collected according to the Arrears Party
(5) Derecognition of Accounts Receivable due to the Transfer of Financial Assets
(6) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of
Accounts Receivable
Other notes:
2. Other Receivables
Unit: RMB
Item Ending balance Beginning balance
Interest receivable 4,481,906.67
Other receivables 15,809,792.55 56,645,592.12
Total 15,809,792.55 61,127,498.79
(1) Interest Receivable
1) Category of Interest Receivable
Unit: RMB
Item Ending balance Beginning balance
Interest of borrowings among units 4,481,906.67
Total 4,481,906.67
2) Significant Overdue Interest
Whether occurred
Entity Ending balance Overdue time Overdue reason impairment and its
judgment basis
Other notes:
3) Information of Withdrawal of Bad Debt Provision
□ Applicable √ Not applicable
(2) Dividends Receivable
1) Category of Dividends Receivable
Unit: RMB
Item (or investees) Ending balance Beginning balance
2) Significant Dividends Receivable Aged over 1 Year
Unit: RMB
Item (or investees) Ending balance Aging Reason Whether occurred
178
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
impairment and its
judgment basis
3) Information of Withdrawal of Bad Debt Provision
□ Applicable √ Not applicable
Other notes:
(3) Other Receivables
1) Other Receivables Disclosed by Accounts Nature
Unit: RMB
Nature Ending carrying amount Beginning carrying amount
Accounts of related party within the scope
15,726,101.80 56,464,614.38
of combination
Petty cash 83,690.75 188,347.31
Total 15,809,792.55 56,652,961.69
2) Information of Withdrawal of Bad Debt Provision
Unit: RMB
First stage Second stage Third stage
Expected loss in the Expected loss in the
Bad debt provision Expected credit loss Total
duration (credit impairment duration (credit impairment
of the next 12 months
not occurred) occurred)
Balance of 1 January
7,369.57
2019
Balance of 1 January
2019 in the current —— —— —— ——
period
Withdrawal of the
-7,369.57
current period
Balance of 30 June 2019 0.00
Changes of carrying amount with significant amount changed of loss provision in the current period
□ Applicable √ Not applicable
Disclosure by aging
Unit: RMB
Aging Ending balance
Within 1 year (including 1 year) 15,809,792.55
Within 3 months 15,809,792.55
Total 15,809,792.55
3) Bad Debt Provision Withdrawal, Reversed or Recovered in the Reporting Period
179
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Information of Withdrawal of Bad Debt Provision
Unit: RMB
Changes in the Reporting Period
Category Beginning balance Ending balance
Withdrawal Reversal or recovery
Bad debt provision of
7,369.57 -7,369.57 0.00
other receivables
Total 7,369.57 -7,369.57 0.00
Of which bad debt provision recovered or reversed with significant amount during the Reporting Period:
Unit: RMB
Name of the entity Reversed or collected amount Method
4) Particulars of the Actual Verification of Other Receivables during the Reporting Period
Unit: RMB
Item Amount
Of which the verification of significant other receivables:
Unit: RMB
Whether occurred
because of
Name of the entity Nature Amount Reason Procedure
related-party
transactions
Notes to the verification of other receivables:
5) Top 5 of the Ending Balance of Other Receivables Collected according to the Arrears Party
Unit: RMB
Proportion to ending
Ending balance of
Name of the entity Nature Ending balance Aging balance of total other
bad debt provision
receivables%
Huaxin (Foshan)
Color Printing Co., Intercourse funds 15,726,101.80 Within 1 year 99.47%
Ltd.
Total -- 15,726,101.80 -- 99.47%
6) Accounts Receivable Involving Government Subsidies
Unit: RMB
Project of government Estimated recovering
Name of the entity Ending balance Ending aging
subsidies time, amount and basis
7) Derecognition of Other Receivables due to the Transfer of Financial Assets
8) The Amount of the Assets and Liabilities Formed due to the Transfer and the Continued Involvement of Other Receivables
Other notes:
180
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3. Long-term Equity Investment
Unit: RMB
Ending balance Beginning balance
Item Depreciation Depreciation
Carrying amount Carrying value Carrying amount Carrying value
reserve reserve
Investment to
1,065,107,442.14 1,065,107,442.14 1,065,107,442.14 1,065,107,442.14
subsidiaries
Investment to
joint ventures and
660,734,770.15 660,734,770.15 654,019,918.14 654,019,918.14
associated
enterprises
Total 1,725,842,212.29 1,725,842,212.29 1,719,127,360.28 1,719,127,360.28
(1) Investment to Subsidiaries
Unit: RMB
Depreciation Ending balance of
Beginning
Investee Increase Decrease Ending balance reserve depreciation
balance
withdrawn reserve
Hongta Renheng 927,570,697.11 927,570,697.11
Huaxin (Foshan)
Color Printing Co., 122,536,745.03 122,536,745.03
Ltd.
Zhejiang Hongta
15,000,000.00 15,000,000.00
Renheng
Total 1,065,107,442.14 1,065,107,442.14
(2) Investment to Joint Ventures and Associated Enterprises
Unit: RMB
Increase/decrease
Ending
Gains and Adjustme
Cash Withdraw balance
Additiona losses nt of
Beginnin Reduced Changes bonus or al of Ending of
Investee l recognize other
g balance investmen of other profits impairme Other balance depreciati
investmen d under comprehe
t equity announce nt on
t the equity nsive
d to issue provision reserve
method income
I. Joint ventures
II. Associated enterprises
181
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
China
Chengton
654,019,9 16,714,85 10,000,00 660,734,7
g Finance
18.14 2.01 0.00 70.15
Corporati
on Ltd.
654,019,9 16,714,85 10,000,00 660,734,7
Subtotal
18.14 2.01 0.00 70.15
654,019,9 16,714,85 10,000,00 660,734,7
Total
18.14 2.01 0.00 70.15
(3) Other Notes
4. Operating Revenue and Cost of Sale
Unit: RMB
Reporting Period Same period of last year
Item
Operating revenue Cost of sales Operating revenue Cost of sales
Main operations 0.00 0.00 0.00 0.00
Other operations 0.00 0.00 0.00 0.00
Total 0.00 0.00 0.00 0.00
Whether the Company has executed the new income standards
□ Yes √ No
Other note:
Naught
5. Investment Income
Unit: RMB
Item Reporting Period Same period of last year
Long-term equity investment income
16,714,852.01
accounted by equity method
Investment income from disposal of
3,214,180.81
long-term equity investment
Disposal 16,714,852.01 3,214,180.81
182
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
6. Other
XVIII. Supplementary Materials
1. Items and Amounts of Non-recurring Profit or Loss
√ Applicable □ Not applicable
Unit: RMB
Item Amount Note
Gains/losses on the disposal of non-current
-16,367.16
assets
Government grants recognized in the current
period, except for those acquired in the
ordinary course of business or granted at 3,936,321.35
certain quotas or amounts according to the
government’s unified standards
Other non-operating income and expense
136,798.06
other than the above
Less: Income tax effects 32,772.64
Non-controlling interests effects 2,348,285.16
Total 1,675,694.45 --
Explain the reasons if the Company classifies an item as an non-recurring gain/loss according to the definition in the Explanatory
Announcement No. 1 on Information Disclosure for Companies Offering Their Securities to the Public—Non-recurring Gains and
Losses, or classifies any extraordinary gain/loss item mentioned in the said explanatory announcement as a recurrent gain/loss item
□ Applicable √Not applicable
2. Return on Equity and Earnings Per Share
EPS (Yuan/share)
Profit as of Reporting Period Weighted average ROE (%)
EPS-basic EPS-diluted
Net profit attributable to ordinary
0.53% 0.0208 0.0208
shareholders of the Company
Net profit attributable to ordinary
shareholders of the Company after
0.45% 0.0174 0.0174
deduction of non-recurring profit or
loss
183
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
3. Differences between Accounting Data under Domestic and Overseas Accounting Standards
(1) Differences of Net Profit and Net Assets Disclosed in Financial Reports Prepared under International
and Chinese Accounting Standards
□ Applicable √ Not applicable
(2) Differences of Net profit and Net assets Disclosed in Financial Reports Prepared under Overseas and
Chinese Accounting Standards
□ Applicable √ Not applicable
(3) Explain Reasons for the Differences between Accounting Data under Domestic and Overseas
Accounting Standards; for any Adjustment Made to the Difference Existing in the Data Audited by the
Foreign Auditing Agent, Such Foreign Auditing Agent’s Name Shall Be Clearly Stated
4. Other
184
Foshan Huaxin Packaging Co., Ltd. Interim Report 2019
Part XI Documents Available for Reference
1. The financial statements signed and stamped by the Company’s legal representative, General Manager and Chief Financial Officer.
2. The originals of all the Company’s announcements and documents disclosed to the public during the Reporting Period on the
media designated by the CSRC for information disclosure.
3. The 2019 Interim Report signed by the legal representative with the seal of the Company.
185
